The Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs 3 lakh on Bollywood actor Shilpa Shetty Kundra, her businessman husband Raj Kundra and their company Viaan Industries for violating insider trading rules.
Kundra, Shetty and Viaan have been fined for a three-year delay in the disclosure of an allotment of preferential shares.
In 2015, Viaan Industries had made a preferential allotment of 500,000 equity shares. Of this 1.28 lakh equity shares each were allotted to Kundra (referred to as Ripu Sudan Kundra) and Shetty, the promoters of the company.
According to SEBI’s Prohibition of Insider Trading Rules, 2015, the promoters had to disclose this transaction to the company within two days if it exceeded Rs 10 lakh in value. The company, in turn, has to relay this disclosure to the stock exchanges within two trading days.
In this case, SEBI said the value of the transaction was Rs 2.57 crore each and the disclosures pertaining to the 2015 transaction were made only in 2019.
In reply to a notice from the regulator, Shetty and Kundra acknowledged the mistake and said it was not done with malafide intent.
However, the SEBI adjudicating officer Suresh B Menon refused this explanation and imposed a fine.
Moneycontrol has reached out to Shetty and this copy will be updated when she replies.
Kundra could not be reached as he is police custody in an unrelated case. He was arrested on July 19 for allegedly making, publishing, and distributing pornography. Earlier a Mumbai court rejected his bail plea.