Huhtamaki PPL Gets a 5 Lakh Fine Notice from SEBI

Huhtamaki PPL Gets a 5 Lakh Fine Notice from SEBI

The Securities and Exchange Board of India (Sebi) had received complaints in July 2014 against the company from the daughters of one Mansukhal Lavajibhai Patadia who was holding 5,465 shares of the firm. The regulator had then initiated adjudication proceedings against the company for failure to redress grievances raised in the complaints.

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Market regulator Sebi has imposed a fine of Rs 5 lakh on packaging firm Huhtamaki PPL in a matter related to non-redressal of investor complaints. The Securities and Exchange Board of India (Sebi) had received complaints in July 2014 against the company from the daughters of one Mansukhal Lavajibhai Patadia who was holding 5,465 shares of the firm.

The regulator had then initiated adjudication proceedings against the company for failure to redress grievances raised in the complaints.

In its order dated June 18, Sebi said that the proceedings have been initiated against the company for the acts of its RTA — Sharepro — on the basis of principal-agent relationship.

Sharepro had acted as registrar and share transfer agent (RTA) for Huhtamaki during the period from 2009 to 2014.

The company has a principal-agent relationship with its RTA, and as principal, the former is liable for the acts of commissions and omissions by the latter, the regulator noted.

According to a notice issued to the company by Sebi, one of the complainants through letters in 2009 had informed the firm about Patadia’s demise in 2008 and requested for not transferring the 5,465 shares held by him to any person. She had also submitted copy of her father’s death certificate through letters. In response, Sharepro had sought certain documents from her.

The regulator noted that the company had acceded to request for change of signature of Patadia made in 2011 and subsequently, transferred 5,465 shares held in his name to another person despite the RTA having acknowledged the letter of the complainant in 2009 communicating the fact of his death.

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