SAT lifts trading ban on 6 more companies
The Securities Appellate Tribunal( SAT) extended interim relief to six more firms— Parsvnath Developers, K av it Industries, KK al pa na Industries, SQSIndia, Pin con Spirit and Sign et Industries—earlier barred from trading by the Securities and Exchange Board of India for being “suspected shell firms ”.
The Securities Appellate Tribunal (SAT) extended interim relief to six more companies earlier barred from trading by the markets regulator, Securities and Exchange Board of India (Sebi), for being "suspected shell companies".
These are Parsvnath Developers, Kavit Industries, Kkalpana Industries, SQS India, Pincon Spirit and Signet Industries. On Thursday, SAT had provided relief to J Kumar Infra and Prakash Industries. The ground was that Sebi passed its impugned order without investigation. Shares of both J Kumar and Prakash hit the 20 per cent lower circuit in Friday's trade.
Since Monday, trading in 331 companies had been halted after they were moved to Stage VI of graded surveillance measures, where trading is allowed only once a month. These entities had moved the appellate tribunal against Sebi for classifying them as “shell companies”. They've all given several documents and their statement of filings to argue that they are not shell companies and are in compliance with all regulations.
“In view of the facts set out in the appeal and other documents relating to annual turnover for the last three years, which even according to Sebi prima facie appear correct, we extend the said stay to the case of the appellant (companies) and direct the stock exchanges to reverse their decision,” said SAT.
The shares of these six companies are likely to resume normal trading from Monday. However, SAT clarified that interim relief would not stop Sebi from further investigation and to "initiate proceedings if deemed fit".
“Since the delay in disposal of the representation is causing serious prejudice to the appellants, we proceed to consider the plea for grant of interim relief," SAT explained.