The Supreme Court has asked Hyderabad-based SVPCL to refund the application money along with interest to the investors who had applied for the company's initial public offer.
The IPO was floated in October last year. Though the issue was fully subscribed, BSE denied permission for the listing of the shares on the exchange as the company had inevidently mentioned on the cover page of its red hearing prospectus that at least 50% of the net issue to the public shall be allocated on proportionate basis to QIB, whereas legally it should be "up to" instead of "at least".
The company than approached SEBI as well as BSE but in the mean time an investor had filed a complaint with Sebi against the company for allegedly wrongdoing.
The company approached BSE to list the shares on January 7, but this was turned down by it as the 10-week period from the date of closing of the IPO has lapsed, which was required under Section 73.
Sebi on the other side told the company to let BSE to decide on the matter. The BSE asked UTI Securities to provide an undertaking, certifying that Section 73 has been complied with. But UTI Securities did not oblige as the 10-week period had lapsed. Consequently, BSE refused permission to the company to list. Against this the company challenged BSE in Andhra Pradesh High court by stating that the delay was on account of pending complaint with SEBI
However, the decision by Supreme court will provide relief to nearly 10,000 investors, who are expected to get a refund in eight days along with 15% interest once SVPCL receives the copy of the order.
The IPO was floated in October last year. Though the issue was fully subscribed, BSE denied permission for the listing of the shares on the exchange as the company had inevidently mentioned on the cover page of its red hearing prospectus that at least 50% of the net issue to the public shall be allocated on proportionate basis to QIB, whereas legally it should be "up to" instead of "at least".
The company than approached SEBI as well as BSE but in the mean time an investor had filed a complaint with Sebi against the company for allegedly wrongdoing.
The company approached BSE to list the shares on January 7, but this was turned down by it as the 10-week period from the date of closing of the IPO has lapsed, which was required under Section 73.
Sebi on the other side told the company to let BSE to decide on the matter. The BSE asked UTI Securities to provide an undertaking, certifying that Section 73 has been complied with. But UTI Securities did not oblige as the 10-week period had lapsed. Consequently, BSE refused permission to the company to list. Against this the company challenged BSE in Andhra Pradesh High court by stating that the delay was on account of pending complaint with SEBI
However, the decision by Supreme court will provide relief to nearly 10,000 investors, who are expected to get a refund in eight days along with 15% interest once SVPCL receives the copy of the order.
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