Coffee Day Enterprises Pays Rs.69 L to Settle Case with Sebi

Coffee Day Enterprises, owner of the Café Coffee Day chain, has settled a securities law violation case with the Securities and Exchange Board of India (Sebi) by paying Rs.69.06 lakh.

On January 21, 2021, Sebi issued a show cause notice to the company alleging various disclosure related violations.

The regulator alleged that the company didn’t place a limited review report before its board of directors at its meetings dated November 13, 2019, and January 29, 2020, wherein the financial results for the quarters ending June 30, 2019, and September 30, 2019, were approved, respectively.

The company submitted unaudited financial results for the quarters ended June 30, 2019, and September 30, 2019, but they were not subjected to limited review by its statutory auditors, Sebi said.

The regulator, in its notice, also alleged that on November 11, 2019, Sanjay Nayar resigned as non-executive director from the company’s board.

However, the information regarding change in director was disclosed on November 13, 2019. Thus, the company exceeded the 24-hour timeline provided under Sebi rules.

There was also delay of two days in making the disclosure dated January 9, 2020, regarding default on payment of interest on loans for the quarter ended December 31, 2019, Sebi said in its notice.

The regulator said on January 23, 2020, the company had disclosed to the stock exchanges that they entered into an agreement to sell Way 2 Wealth Securities, including its certain subsidiaries to Shriram Ownership Trust. However, the details of the sale transaction were not disclosed by the company.

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