Mumbai: Market regulator Sebi on Monday imposed a fine of Rs 5 lakh on Anand Rathi Financial Services for alleged violations of guidelines on issue of contract notes and others.
"After taking into consideration all the facts and circumstances of the case ... impose a monetary penalty of Rs 5 lakh on the Noticee (Anand Rathi Financial Services Ltd) which will be commensurate with the violations committed by it," the Securities and Exchange Board of India said in an order.
It also directed the company to deposit the quantum of fine within 45 days.
The case relates to the inspection of books and records of Anand Rathi between April 2007 and March 2009 wherein it was found that the company had failed in delivery of contract notes to the clients, besides not having the adequate system in place to check receipt of third party cheques and not following account opening process properly, among others.
The company was issued a show cause notice in January this year. Anand Rathi in its reply a month later had denied all the allegations. Sebi conducted an investigation into the matter. In its order, it said that "it is clear that the conduct of the Noticee during the adjudication proceedings was far from satisfactory and it is evident from the documents and material available on record that the Noticee used all possible excuses and tried every bit to divert the attention and mislead the proceedings."
It also said that Anand Rathi submitted the backdated agreements.
"... it (Anand Rathi) has failed in exercising due skill, care and diligence in conduct of its business. On judicious exercise of the discretion conferred upon me, bearing in mind the facts and circumstances of this case... hold that the allegation of the violation... by the Noticee stands established," Sebi said
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