BREAKING: SEBI Imposes Rs 3 Lakh Penalty On Raj Kundra, Shilpa Shetty, Viaan Industries For Violating Insider Trading Norms

The Securities and Exchange Board of India has imposed a penalty of Rs 3 lakhs on Viaan Industries and its promoters Shilpa Shetty and her husband Raj Kundra for violating SEBI (Prohibition of Insider Trading) Regulations, 2015.

The order was passed based on an investigation into the tradings of the company listed in Bombay Stock Exchange during the period 2013- 2015.

On October 29, 2015, VIL made a preferential allotment of 5,00,000 equity shares to four persons and in the said preferential allotment 1,28,800 shares each were allotted to Shilpa Shetty and Raj Kundra.  In this regard, pursuant to the allotment of the shares through the preferential allotment, both of them were required to make the necessary disclosure to the company in terms of the provisions of Regulation 7(2) (a) of the PIT Regulations, as the relevant  transactions in question through the aforementioned preferential allotment exceeded Rupees Ten Lakh in value. Further, in terms of  Regulation 7 (2) (b) of the PIT Regulations, the Company was required to make the necessary disclosures to the stock exchange within two trading days of the receipt of the disclosures from Shetty and Kundra. During  the course of investigation, the market regulator observed that the Shetty and Kundra had failed to make the relevant disclosures required under Regulations 7 (2) (a) and 7 (2) (b) of the PIT Regulations within the stipulated time period.

They made the relevant disclosures under the month of May, 2019 i.e. with a delay of more than three years

 "It is on record that the relevant disclosures under the PIT Regulations were made by the Noticees with a delay of more than three years," SEBI noted. "Therefore, considering these facts and circumstances, I hold that this case deserves imposition of monetary penalty upon the Noticees," said adjudicating officer Suresh B Menon in an order.

The SEBI said that timely disclosures to the Company/stock exchange are of significant importance from the point of view of the investors and regulators.

Click here to read/download the order