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Regstreet Law Advisors successfully represented Piramal Pharma Limited at SEBI

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In a significant ruling yesterday, SEBI’s Adjudicating Officer concluded that a demerged entity of a publicly listed company cannot be held accountable for alleged violations of disclosure requirements related to events that occurred prior to the incorporation of the demerged entity.

In the order concerning Piramal Pharma Limited within the context of Piramal Enterprises Limited, SEBI had issued a show cause notice alleging breaches of SEBI LODR Regulations due to certain alleged non-disclosures in 2018, which SEBI considered to be material events. Even though these events transpired before the incorporation of Piramal Pharma Limited, SEBI contended that, due to a composite scheme of arrangement, all liabilities of Piramal Enterprises Limited. were transferred to Piramal Pharma Limited.

Piramal Pharma Limited, represented by Regstreet Law Advisors, argued that the responsibility for disclosure under LODR Regulations rests with the listed entity. Given that Piramal Pharma Limited was not in existence at the time of the alleged material events, it cannot be held accountable for the purported violations.

The Learned Adjudicating Officer concurred with the stance that Piramal Pharma Limited cannot be held liable for events preceding its incorporation and listing, resulting in the closure of the adjudication proceedings without any penalty.

Mr. Sumit Agrawal (Partner), Mr. Pratham Darad (Principal Associate), and Ms. Krishi Jain (Associate) from Regstreet Law Advisors acted on behalf of Piramal Pharma Limited.

A copy of the SEBI Order is enclosed herewith.

Readers are welcome to send their views to Regstreet Law Advisors at info@regstreetlaw.com

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