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BEFORE THE ADJUDICATING OFFICER

SECURITIES AND EXCHANGE BOARD OF INDIA


ADJUDICATION ORDER NO. JJ/AK/AO19/2015

UNDER SECTION 15-I OF SECURITIES AND EXCHANGE BOARD OF INDIA ACT,


1992 READ WITH RULE 5 OF SEBI (PROCEDURE FOR HOLDING INQUIRY AND
IMPOSING PENALTIES BY ADJUDICATING OFFICER) RULES, 1995
In respect of:
M/s Genus Prime Infra Limited
(Erstwhile known as "M/s. Gulshan Chemfill Limited")
(PAN AABCG3955E)
In the Matter of M/s Genus Prime Infra Limited
_____________________________________________________________________________________________
BACKGROUND
1. Securities and Exchange Board of India (hereinafter referred to as "SEBI")
came out with a Circular dated June 03, 2011 dealing with the processing of
investor complaints against listed companies through SEBI Complaints
Redress System (hereinafter referred to as "SCORES"). In terms of said
Circular, all listed companies were inter alia required to view the complaints
pending against them, redress them and submit Action Taken Reports
(hereinafter referred to as "ATRs") electronically in SCORES. As the SCORES
is online electronic system, therefore, for the purposes of accessing the
complaints of the investors against them, as uploaded in the SCORES, listed
companies were required to login to SCORES system electronically through a
company specific user id and password, to be provided by SEBI. For the
purpose of generating said user id and password, listed companies which
were yet to obtain SCORES user id and password, were required to submit the
details for authentication to SEBI, in the format annexed to the said Circular.
However, it was observed that M/s Genus Prime Infra Limited (Erstwhile
Adjudication Order in respect of M/s Genus Prime Infra Limited (Erstwhile Known as 'M/s Gulshan Chemfill Limited')
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known as "M/s. Gulshan Chemfill Limited") (hereinafter referred to as


"Noticee") did not submit the details to SEBI which were required to be
furnished in terms of the said Circular.
2. In order to further remind the Noticee about the compliance with the
requirements as laid down in the SEBI Circular dated June 03, 2011, letter
dated April 18, 2012 were sent to the Noticee informing about the
commencement of processing of investor complaints in a centralized web
based complaints redress system SCORES in terms of the Circular and
advising the Noticee to send the information (i.e. details for authentication) as
required in the Circular, at the earliest.
3. As observed from the contents of the Circular, SCORES introduced electronic
dealing of the complaints of the investors, by the respective companies. Thus,
once a complaint against a company was uploaded by SEBI in the SCORES, it
amounted to calling upon by SEBI to such company to redress the investor
grievance. Accordingly, it was incumbent upon such company to redress the
investor complaint. It was observed that two investor complaint was pending
against the Noticee as on August 27, 2012. However, it was alleged that the
Noticee failed to redress pending investor grievances and also failed to obtain
SCORES authentication in spite of being called upon by SEBI to do so thereby
violating the provisions of Section 15C of the SEBI Act, 1992.
4. Shri Praveen Trivedi was appointed as the Adjudicating Officer to inquire and
adjudge under Section 15C of the SEBI Act, 1992, the alleged violations
committed by the Noticee. Pursuant to the transfer of Shri Praveen Trivedi,
the undersigned was appointed as Adjudicating Officer vide Order dated
December 18, 2013.
SHOW CAUSE NOTICE, HEARING & REPLY
5. Show Cause Notice (SCN) in terms of the provisions of Rule 4(1) of SEBI
(Procedure for Holding Inquiry and Imposing Penalties by Adjudicating

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Officer) Rules, 1995 (hereinafter referred to as "Adjudication Rules") was


issued to the Noticee on July 24, 2013, calling upon the Noticee to show cause
why an inquiry should not be held against it under Rule 4(3) of the
Adjudication Rules read with Section 15I of the SEBI Act, 1992 for the alleged
violations.
6. I find from the records that the aforesaid SCN was sent at the last known
address of the Noticee at "9th KM, Jansath Road, Muzaffar Nagar, Uttar
Pradesh - 251001". The said SCN was duly delivered to the Noticee through
the Department of Post. Noticee vide letter dated August 06, 2013 had
submitted its reply in the matter, which inter alia stated as under:
"..........

In reply to contents to Para 4 of the Show Cause Notice, we state that in


compliance with the requirements as laid down in the circular, we have
registered ourselves with SEBI Complaints Redress System(SCORES). We
further state that an application dated 30.08.2012 was sent by us through
email on 08.09.2012 and reply in respect thereof was received by us
17.09.2012 from SCORES, informing us about our User Id and password.
this act of our is ample proof that we have duly complied with your
Circular and completed our registration process with SCORES.....On
successful completion of our registration process with SCORES, it was
presumed by us that if any delay occasioned by us that has resulted, if in
contravention of Circular issued by SEBI, ought to have been condoned by
yourselves, on receiving said reply to our application. Our intentions have
always to be in compliance with SEBI Rules & regulations issued from time
to time as per Company listed with it.
In Reply to contents of Para 5 of show cause notice, we state that the
Complaints as mentioned therein, initiated against us have been disposed
on 22nd July, 2013. The same is evident online on SCORES Website.
In Reply to contents of Para 6 of show cause notice, we state and reiterate
the contents mentioned in Para 4 above. It is evident and substantiated
from your letter / mail dated 17th September, 2012 , that Yourselves have
duly acknowledged our registration process and provided us User Id and
password. The contents of para 6 of your show cause notice are vehemently
denied. We further state that the two investor grievances were duly
redressed by Ourselves and they were disposed on 22nd July, 2013 as
mentioned above. We attach herewith copy pertaining to disposal of said
two complaints....... for you consideration, information and records. The
said fact can be substantiated / verified, from SCORES website. We, in view
of said facts further states and submit that we are not liable to be penalized
under section 15C of the Act (SEBI).
........."

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7. Subsequent to the appointment of the undersigned, in the interest of natural


justice and in order to conduct an inquiry in terms of rule 4(3) of the
Adjudication Rules, the Noticee was granted an opportunity of personal
hearing on February 13, 2015, vide notice dated January 20, 2015 at SEBI,
Head Office, Mumbai. The said Notice of hearing dated January 20, 2015 along
with a copy of SCN dated July 24, 2013 was duly delivered via hand at the
aforesaid address of the Noticee through Northern Regional Office of SEBI,
New Delhi on January 24, 2015 (Delivery report is present on record).
8. Noticee vide letter dated January 30, 2015 had submitted additional written
submissions in the matter, which inter alia stated as under:
"..........

Our reply dated 06.08.2013 has been duly acknowledged by you as a reply
to your show cause letter no. LAD-NRO/ADJ/EIF-04/21/20/13/6272/2013
dated 24.07.2013. In our reply submitted earlier we have given details of
SCORES registration of the company and detail of the two complaints
resolved by the company.....
In view of the above mentioned facts, we request you to consider our Reply
and not hold us liable for any penalty under any provision of the SEBI
(Procedure for Holding Inquiry and Imposing Penalties by Adjudicating
Officer) Rules, 1995.
........."
9. On the scheduled date of personal hearing, Ms. Nikita Dubey, appeared as
Authorised Representative (AR). During the hearing, the AR reiterated the
submissions made by the Noticee vide letters dated August 06, 2013 and
January 30, 2013.

ISSUES FOR CONSIDERATION


10. After perusal of the material available on record, I have the following issues
for consideration, viz.,
A. Whether the Noticee has failed to resolve investor grievances?
B. Whether the Noticee is liable for monetary penalty under Section 15C of
the SEBI Act, 1992?
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C. What quantum of monetary penalty should be imposed on the Noticee


taking into consideration the factors mentioned in Section 15J of the SEBI
Act, 1992?
FINDINGS
11. On perusal of the material available on record and giving regard to the facts
and circumstances of the case, I record my findings hereunder.
ISSUE 1: Whether the Noticee has failed to resolve investor grievances?
12. As already observed, SEBI introduced an online electronic system for
resolution of investor grievances, i.e., SCORES in 2011. For the purposes of
accessing the complaints of the investors against them, as uploaded in the
SCORES, listed companies were required to login to SCORES system
electronically through a company specific user id and password, to be
provided by SEBI. Further, vide letter dated April 18, 2012 the Noticee was
informed about the commencement of SCORES and the Noticee was advised to
send the details for authentication as required in the Circular. In this regard,
from the submissions of the Noticee I note that it had provided details for
authentication for SCORES user id & password in September 2012. Regarding
the two pending investor complaint which was relating to non-receipt of
shares after transfer and non-receipt of shares after Conversion /
endorsement / consolidation / splitting, as mentioned in the SCN, the Noticee
has stated that it had duly redressed the investor grievances and were
disposed on July 22, 2013. Subsequently, SEBI has also confirmed that the
Noticee had obtained SCORES authentication on September 17, 2012 and had
resolved the pending investor grievance (as mentioned in the SCN) on July 23,
2013.
13. Since, the Noticee had obtained SCORES authentication and had taken
necessary steps of resolving the pending investor grievance before the

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issuance of SCN; I hold that the allegation of not resolving investor grievances,
as alleged in the SCN, does not stand established.
ISSUE 2: Whether the Noticee is liable for monetary penalty under Section
15C of the SEBI Act, 1992?
14. The provisions of Section 15C of the SEBI Act, 1992, read as under:
15C Penalty for failure to redress investors' grievances: If any listed
company or any person who is registered as an intermediary, after having
been called upon by the Board in writing, to redress the grievances of
investors, fails to redress such grievances within the time specified by the
Board, such company or intermediary shall be liable to a penalty of one lakh
rupees for each day during which such failure continues or one crore rupees,
whichever is less.
15. Since the allegation against the Noticee of not resolving the investor grievance
pending against it has not been established; therefore, the Noticee is not liable
for monetary penalty under Section 15C of the SEBI Act, 1992.
ISSUE 3: What quantum of monetary penalty should be imposed on the
Noticee taking into consideration the factors mentioned in Section 15J of
the SEBI Act, 1992?
16. Since, the Noticee is not liable for monetary penalty in the instant matter, this
issue deserves no consideration.
ORDER
17.

In view of my findings noted in the preceding paragraphs, I hereby dispose of


the Adjudication Proceedings initiated against the Noticee vide Show Cause
Notice dated July 24, 2013.

18. In terms of the provisions of Rule 6 of the SEBI (Procedure for Holding Inquiry
and Imposing Penalties by Adjudicating Officer) Rules 1995, copies of this

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Order are being sent to the Noticee and also to Securities and Exchange Board
of India.

Date: February 23, 2015


Place: Mumbai

Jayanta Jash
Adjudicating Officer

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