Regstreet Law Advisors represented Gretex Corporate Services Limited, a SEBI-registered Merchant Banker and a listed company, before SEBIโs Quasi-Judicial Authority (QJA) in proceedings under the SEBI (Merchant Bankers) Regulations, 1992 and the SEBI (Intermediaries) Regulations, 2008.
Following detailed consideration of the matter, the QJA issued its order directing a 21-day restriction on taking up new assignments, in place of the one-month prohibition proposed by the Designated Authority. The decision reflects a reasoned and proportionate regulatory outcome following comprehensive submissions on behalf of Gretex.
๐๐๐๐ค๐ ๐ซ๐จ๐ฎ๐ง๐:
The proceedings concerned SEBIโs observations relating to:
1. Maintenance of minimum net worth during FY 2019โ20 under Regulation 7 of the Merchant Banker Regulations, and
2. Due diligence performed in connection with an SME public issue managed by the Merchant Banker.
๐ ๐ข๐ง๐๐ข๐ง๐ ๐ฌ ๐๐ง๐ ๐๐๐ฌ๐๐ซ๐ฏ๐๐ญ๐ข๐จ๐ง๐ฌ:
While SEBI reiterated that maintaining minimum net worth is a continuing obligation, the QJA also recorded that Gretex had promptly undertaken corrective steps and strengthened its compliance framework.
On the due diligence issue, SEBI noted the enhanced processes and systems implemented by Gretex since the relevant period, which were taken into account in determining the final direction.
๐๐ข๐ซ๐๐๐ญ๐ข๐จ๐ง:
The QJA, applying principles of proportionality and fairness, limited the restriction to 21 days, effective immediately. The restriction is set to conclude on or about 19 November 2025, marking closure of the direction period.
While the order provides its reasoning, Gretex continues to review the order and evaluate next steps in accordance with applicable law.
Team:
Mr. Sumit Agrawal (Managing Partner)
Mr. Kavish Garach (Senior Associate)
Ms. Aditi Sahu (Associate)
Order Link: https://lnkd.in/gEWf7zSQ
Feel free to write toย Regstreet Law Advisorsย onย info@regstreetlaw.com.
