<p>In a consent order passed today, the Securities and Exchange Board of India (Sebi) said that it has agreed to settle the case after the two companies agreed to its certain terms and conditions, including the payment of settlement charges.<br /><br />The case relates to a probe by Sebi in dealings in the shares of another Anil Ambani group firm Reliance Communications and investigations related to alleged violation of foreign investment norms.<br /><br />As per the conditions of the settlement, the two companies would not be able to invest in any listed shares in the secondary market, other than mutual funds, until December 2012 and the individuals named in the case, which includes chairman Anil Ambani, can not invest in secondary market untill December 2011.<br /><br />However, this condition will not apply to primary market issuances, buybacks and open offers.Commenting on the Sebi order, a Reliance Infrastructure spokesperson said: "Reliance Infra has voluntarily settled SEBI show-cause proceedings of June 2010 against the company and its directors.<br /><br />"In accordance with SEBI consent mechanism, the settlement is without admission or denial of guilt. Settlement made in interests of investors to pre-empt unnecessary and time-consuming litigation."<br /><br />The company said that their directors have voluntarily made payment of entire settlement fees, with no burden on Reliance Infra, and added the settlement maintains full financial flexibility of the company to implement its growth projects.<br /><br />As per the order, the two companies would also have to implement a policy of rotating their statutory auditors and, therefore, the auditors as on March 2010 cannot be reappointed for a period of three years commencing from 2010-11.<br /><br />Sources said that the companies have already implemented the rotation of auditors policy is in accordance with risk management best practices.<br /><br />The companies voluntarily offered to not make investments in secondary market to conserve resources for investment in own substantial projects, and will not impact growth prospects in any manner, the sources close to the development said. <br /></p>
<p>In a consent order passed today, the Securities and Exchange Board of India (Sebi) said that it has agreed to settle the case after the two companies agreed to its certain terms and conditions, including the payment of settlement charges.<br /><br />The case relates to a probe by Sebi in dealings in the shares of another Anil Ambani group firm Reliance Communications and investigations related to alleged violation of foreign investment norms.<br /><br />As per the conditions of the settlement, the two companies would not be able to invest in any listed shares in the secondary market, other than mutual funds, until December 2012 and the individuals named in the case, which includes chairman Anil Ambani, can not invest in secondary market untill December 2011.<br /><br />However, this condition will not apply to primary market issuances, buybacks and open offers.Commenting on the Sebi order, a Reliance Infrastructure spokesperson said: "Reliance Infra has voluntarily settled SEBI show-cause proceedings of June 2010 against the company and its directors.<br /><br />"In accordance with SEBI consent mechanism, the settlement is without admission or denial of guilt. Settlement made in interests of investors to pre-empt unnecessary and time-consuming litigation."<br /><br />The company said that their directors have voluntarily made payment of entire settlement fees, with no burden on Reliance Infra, and added the settlement maintains full financial flexibility of the company to implement its growth projects.<br /><br />As per the order, the two companies would also have to implement a policy of rotating their statutory auditors and, therefore, the auditors as on March 2010 cannot be reappointed for a period of three years commencing from 2010-11.<br /><br />Sources said that the companies have already implemented the rotation of auditors policy is in accordance with risk management best practices.<br /><br />The companies voluntarily offered to not make investments in secondary market to conserve resources for investment in own substantial projects, and will not impact growth prospects in any manner, the sources close to the development said. <br /></p>