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Capital market regulator SEBI has fined New Delhi Television (NDTV) Rs 2 crore for not disclosing to the stock exchanges that the Income Tax Department had raised a tax demand of Rs 450 crore on the company on February 21, 2014, for the assessment year 2009-10 (FY09).The penalty has to be paid within 45 days.
SEBI observed that the above information was not disclosed by NDTV immediately to the stock exchanges — BSE and NSE.
The company informed this to the NSE in its letter dated May 26, 2014 and to BSE in its letter dated May 29, 2014. This too was not voluntary, but in response to the clarifications sought by the stock exchanges, SEBI observed.
SEBI found that NDTV had violated Clause 36 of the listing agreement which required listed companies to disclose material information as and when it occurred along with the assessment of impact.
“Correct and timely disclosures are also an essential part of the proper functioning of the securities market and failure to do so results in preventing investors from taking well-informed decisions Thus, the cornerstone of the clause is investor protection,” SEBI said.
SEBI also noted that the price of the scrip was not impacted when the disclosure was made belatedly and also that the said disclosure was made after subsequent developments such as stay granted by the Income Tax Appellate Tribunal (ITAT).
SEBI further noted that it was a stand-alone case of violation by NDTV and not repetitive.
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