In what spells further trouble for the promoters of New Delhi Television Ltd (NDTV), Prannoy and Radhika Roy have been directed by the Securities Appellate Tribunal (SAT) to deposit 50 per cent of the disgorged amount before markets regulator SEBI within four weeks.
The tribunal noted that NDTV should deposit the amount, the balance amount will not be recovered during the pendency of the appeal before SAT. At present, the tribunal has directed the appeals of the Roys for final disposal on February 10, 2021.
SEBI, in an insider trading case, passed an order in November whereby it had barred the Roy couple from the securities market for two years and also directed them to disgorge illegal gains of Rs 16.97 crore. The SAT order is in response to appeals filed by the NDTV promoters against the Semi order.
While the company continues to deny the charges, SEBI stated that the Roy couple made gains by indulging in insider trading in the shares of NDTV while in the possession of unpublished price sensitive information (UPSI) relating to the proposed reorganization of the company which started in September 2007 with the disclosure being made in April 2008.
It is pertinent to note that during the aforementioned period, Prannoy Roy was the chairman and whole-time director and Radhika Roy was the managing director of NDTV.
The SEBI order states that the Roy couple through the possession of UPSI made a profit of Rs 16.97 crore which is in violation of Prohibition of Insider Trading (PIT) norms.
Earlier in December 2020, Sebi had imposed a hefty fine of 27 crore rupees for withholding important information from shareholders.NDTV entered into a secretive loan agreement with ICICI Bank in 2008 and later with VCPL in 2009 and 2010. The loan with VCPL was warranted with the transfer of shares by the promoters, but the management failed to disclose these deals despite being a publicly-traded company.
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“Consequently, information about the said agreements and off-market transactions were essentially material, price-sensitive information which would have influenced the decision of investors about trading in shares of NDTV,” said the SEBI in its order.
Therefore, the securities transaction regulator had imposed a fine of 25 crore rupees on RRPR Holding Private Limited and 1 crore each for Radhika Roy and Prannoy Roy.
It seems that the troubles are mounting for the Roys and it remains to be seen whether the couple would pay 50 per cent of the disgorged amount within the stipulated time period.
