RCom settles case with Sebi by paying Rs 6.24 million as penalty

Anil Ambani, Chairman of India’s Reliance Communication | Photo: Reuters

Debt-laden Reliance Communications (RCom) has settled a case with markets regulator Sebi over non-compliance with listing norms, including alleged failure to promptly inform about interest payment default on debentures, according to an order.

The company, part of the Anil Ambani group, also settled the issue of non-cooperation with the credit rating agencies and debenture trustee that were in violation of listing norms.

In an order on Friday, Sebi said the case has been settled after payment of Rs 6.2 million towards settlement charges.

"The proceedings that could have been initiated for the defaults... are settled qua the applicant," the order said.

It also noted that Sebi shall not initiate any enforcement action against the applicant.

The order comes after RCom filed a suo-moto application with Sebi to settle the case. Under the settlement mechanism, an entity is allowed to settle charges by paying a penalty without admission or denial of guilt.

One of the issues was about not informing the default in the payment of interest/ principal to the debenture trustee promptly. Another issue pertained to non-submission of information with respect to change in credit rating and not sending notices relating to the meetings of non-convertible debentures (NCD) holders to the debenture trustee.

According to the order, the authorised representatives of the company had a meeting with the internal committee of Sebi in March 9, wherein the settlement terms were deliberated.

Thereafter, Sebi's high powered advisory committee recommended the case for settlement on the payment of the Rs 6.2 million by the applicant and the the same was approved by the regulator's panel of whole-time members. Accordingly, Securities and Exchange Board of India (Sebi) has disposed of the adjudication proceedings initiated against RCom.

That enforcement actions, including commencing or reopening of the proceedings, could be initiated if any representation made by it is found to be untrue, it added.

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