Adjudication Order in respect of Nirlon Ltd in the matter of Sharepro Services India Pvt Ltd

This adjudication order concerns Nirlon Limited's failure to comply with directions issued by the Securities and Exchange Board of India (SEBI) in March 2016. These directions required companies using Sharepro Services (I) Private Limited as their registrar and transfer agent to conduct thorough audits of Sharepro's records concerning dividend payments and security transfers. Nirlon Limited did not fulfil these audit and reporting obligations, leading SEBI to initiate adjudication proceedings.

BEFORE THE ADJUDICATING OFFICER
SECURITIES AND EXCHANGE BOARD OF INDIA
[ADJUDICATION ORDER NO. Order/KS/AE/2020-21/9401]
 

UNDER SECTION 15-I OF THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 READ WITH RULE 5 OF SEBI (PROCEDURE FOR HOLDING INQUIRY AND IMPOSING PENALTIES) RULES, 1995
 

In respect of:
Nirlon Limited
(CIN: L17120 MH1958PLC 011045)
 

In the matter of Sharepro Services (I) Private Limited
 

BACKGROUND

1. The Whole Time Member of Securities and Exchange Board of India vide ex-parte ad-interim order dated March 22, 2016 gave the following directions to the companies, who were clients of the Registrar and Transfer Agent - M/s Sharepro Services (I) Private Limited (hereinafter referred to as ‘Sharepro’):

11. Companies who are clients of Sharepro are directed to conduct a thorough audit of the records and systems of Sharepro with respect to dividends paid and transfer of securities to determine whether dividends have been paid to actual/beneficial holders and whether securities have been transferred as per the provisions of law. This audit should cover the dividends paid/transfers effected within the preceding at least 10 years. The audit directed above shall be completed by the companies within a period of three months from the date of this order and thereafter a report shall be submitted to SEBI by the companies in that regard. Further, within a period of six months from the date of this order, the companies shall take appropriate action, in cases where violations are observed, in accordance with the provisions of law and inform SEBI accordingly.

12. Companies who are clients of Sharepro are also advised to carry out / switchover their activities related to a registrar to an issue and share transfer agent, either in-house or through another registrar to an issue or share transfer agent registered with SEBI. Sharepro shall provide the requisite cooperation to these companies for the purpose.

2. Securities and Exchange Board of India (hereinafter referred to as ‘SEBI’) observed that Nirlon Limited (hereinafter referred to as the ‘Noticee’) failed to comply with the directions issued by Whole Time Member of SEBI vide order dated March 22, 2016. In view of same, SEBI initiated adjudication proceedings against the Noticee under the provisions of Section 15HB of the SEBI Act, 1992 (hereinafter referred to as the ‘SEBI Act’).

To know more in details find the attachment file