BEFORE THE ADJUDICATING OFFICER

SECURITIES AND EXCHANGE BOARD OF INDIA

ADJUDICATION ORDER NO. JJ/AK/AO26/2015

UNDER SECTION 15-I OF SECURITIES AND EXCHANGE BOARD OF INDIA ACT,

1992 READ WITH RULE 5 OF SEBI (PROCEDURE FOR HOLDING INQUIRY AND
IMPOSING PENALTIES BY ADJUDICATING OFFICER) RULES, 1995
In respect of:
M/s Coventry Coil-o-Matic Haryana Limited
(PAN AAACC7772J)
In the Matter of M/s Coventry Coil-o-Matic Haryana Limited
_____________________________________________________________________________________________
BACKGROUND
1. Securities and Exchange Board of India (hereinafter referred to as "SEBI")
came out with a Circular dated June 03, 2011 dealing with the processing of
investor complaints against listed companies through SEBI Complaints
Redress System (hereinafter referred to as "SCORES"). In terms of said
Circular, all listed companies were inter alia required to view the complaints
pending against them, redress them and submit Action Taken Reports
(hereinafter referred to as "ATRs") electronically in SCORES. As the SCORES
is online electronic system, therefore, for the purposes of accessing the
complaints of the investors against them, as uploaded in the SCORES, listed
companies were required to login to SCORES system electronically through a
company specific user id and password, to be provided by SEBI. For the
purpose of generating said user id and password, listed companies which
were yet to obtain SCORES user id and password, were required to submit the
details for authentication to SEBI, in the format annexed to the said Circular.
However, it was observed that M/s Coventry Coil-o-Matic Haryana Limited

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Adjudication Order in respect of M/s Coventry Coil-o-Matic (Haryana) Limited

February 23, 2015

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(hereinafter referred to as "Noticee") did not submit the details to SEBI

which were required to be furnished in terms of the said Circular.
2. In order to further remind the Noticee about the compliance with the
requirements as laid down in the SEBI Circular dated June 03, 2011, letter
dated March 13, 2012 were sent to the Noticee informing about the
commencement of processing of investor complaints in a centralized web
based complaints redress system SCORES in terms of the Circular and
advising the Noticee to send the information (i.e. details for authentication) as
required in the Circular, at the earliest.
3. As observed from the contents of the Circular, SCORES introduced electronic
dealing of the complaints of the investors, by the respective companies. Thus,
once a complaint against a company was uploaded by SEBI in the SCORES, it
amounted to calling upon by SEBI to such company to redress the investor
grievance. Accordingly, it was incumbent upon such company to redress the
investor complaint. It was observed that four investor complaint was pending
against the Noticee as on August 27, 2012. However, it was alleged that the
Noticee failed to redress pending investor grievances and also failed to obtain
SCORES authentication in spite of being called upon by SEBI to do so thereby
violating the provisions of Section 15C of the SEBI Act, 1992.
4. Shri Praveen Trivedi was appointed as the Adjudicating Officer to inquire and
adjudge under Section 15C of the SEBI Act, 1992, the alleged violations
committed by the Noticee. Pursuant to the transfer of Shri Praveen Trivedi,
the undersigned was appointed as Adjudicating Officer vide Order dated
December 18, 2013.
SHOW CAUSE NOTICE, HEARING & REPLY
5. Show Cause Notice (SCN) in terms of the provisions of Rule 4(1) of SEBI
(Procedure for Holding Inquiry and Imposing Penalties by Adjudicating
Officer) Rules, 1995 (hereinafter referred to as "Adjudication Rules") was

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Adjudication Order in respect of M/s Coventry Coil-o-Matic (Haryana) Limited

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issued to the Noticee on July 19, 2013, calling upon the Noticee to show cause
why an inquiry should not be held against it under Rule 4(3) of the
Adjudication Rules read with Section 15I of the SEBI Act, 1992 for the alleged
violations.
6. I find from the records that the aforesaid SCN was sent at the last known
address of the Noticee at "87th K.M. Stone, Nh-8, Delhi Jaipur Road Village &
P.O. Sahalawas, Sangwari, Tehsil & Dist. Rewari - 123401". The said SCN was
duly delivered to the Noticee through the Department of Post on July 26,
2013. Noticee vide letter dated August 12, 2013 had submitted its reply in the
matter, which inter alia stated as under:
"..........

With reference to above, we would like to inform that the Company has got
itself registered with SCORE of SEBI on 05th November 2012. The
company has received the four complaints as mentioned by you. All the
complaints are resolved by 29th July 2013 and no complaints are pending
as on date.
Kindly find attached herewith details of the complaints resolved by the
Company.
........."

7. Subsequent to the appointment of the undersigned, in the interest of natural

justice and in order to conduct an inquiry in terms of rule 4(3) of the
Adjudication Rules, the Noticee was granted an opportunity of personal
hearing on February 06, 2015, vide notice dated January 12, 2015 at SEBI,
Head Office, Mumbai. The said Notice of hearing dated January 12, 2015 was
duly delivered via hand at the aforesaid address of the Noticee through
Chandigarh Local Office of SEBI, New Delhi on January 19, 2015 (Delivery
report is present on record).
8. On the scheduled date of personal hearing, Mr. Khalid Omar Siddiqui,
Practicing Company Secretary, appeared as Authorised Representative (AR).
During the hearing, the AR made the following submissions on behalf of the
Noticee:
"..........

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Adjudication Order in respect of M/s Coventry Coil-o-Matic (Haryana) Limited

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I reiterated the submissions made by the Noticee vide letter dated August
12, 2013. In addition to it I submit the SCORES Authentication details
provided to the Noticee by SEBI vide email dated November 05, 2012.
Further, till dated no investors complaint is pending against the Noticee
(current ATR status with SCORES is hereby submitted).
I would like to state that out of the 4 pending complaints, 3 complaints
were resolved before the issuance of show cause notice (SCN) dated July
19, 2013 which was received on evening of July 26, 2013 (Friday). The
process of redressing remaining 1 complaint was underway and completed
on July 29, 2013 (Monday) i.e. the first working day after the receipt of
SCN. The scanned copy of the letter sent to the investor for the complaint
resolved on July 29, 2013 will be sent to you by email by February 13,
2015.
I do not have any other submissions to make in the matter."

9. Noticee vide letter dated February 11, 2015 had submitted additional written
submission in the matter, which inter alia stated as under:
"..........

With reference to above and as per the undertaking made by us we are

attaching the letter sent to Mr. Virender Kumar Jain through speed post on
26th June 2013 is attached alongwith the receipt of the speed post.
We would like to further state that the complaint was because of some
misunderstanding and lack of proper proof. the Company had taken all
possible steps to ensure the redressal of the case but we were not give any
details of the case......"

ISSUES FOR CONSIDERATION

10. After perusal of the material available on record, I have the following issues
for consideration, viz.,
A. Whether the Noticee has failed to resolve investor grievances?
B. Whether the Noticee is liable for monetary penalty under Section 15C of
the SEBI Act, 1992?
C. What quantum of monetary penalty should be imposed on the Noticee
taking into consideration the factors mentioned in Section 15J of the SEBI
Act, 1992?

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Adjudication Order in respect of M/s Coventry Coil-o-Matic (Haryana) Limited

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FINDINGS
11. On perusal of the material available on record and giving regard to the facts
and circumstances of the case, I record my findings hereunder.
ISSUE 1: Whether the Noticee has failed to resolve investor grievances?
12.

As already observed, SEBI introduced an online electronic system for

resolution of investor grievances, i.e., SCORES in 2011. For the purposes of
accessing the complaints of the investors against them, as uploaded in the
SCORES, listed companies were required to login to SCORES system
electronically through a company specific user id and password, to be
provided by SEBI. Further, vide letter dated April 18, 2012 the Noticee was
informed about the commencement of SCORES and the Noticee was advised to
send the details for authentication as required in the Circular. In this regard,
from the submissions of the Noticee I note that it had obtained the details for
authentication for SCORES user id & password on November 05, 2012.
Regarding the four pending investor complaint which was relating to nonreceipt of shares after transfer, non-receipt of Dividend and non-receipt of
refund in public /rights issue, as mentioned in the SCN, the Noticee has stated
that it had duly redressed/resolved the 3 investor grievances, before the
issuance of SCN dated July 19, 2013 [which was received by the Noticee on
evening of July 26, 2013 (Friday)]. The process of redressing/resolving
remaining 1 complaint was underway and completed on July 29, 2013
(Monday) i.e. the first working day after the receipt of SCN.

From the

submissions of the Noticee and upon perusal of the action history, with
respect to the 1 investor complaint which has been resolved after receiving
the SCN, I find that before the issuance of SCN, Noticee had took the necessary
step in resolving the investor complaint by issuing a letter to the complainant
on June 25, 2013. Subsequently, SEBI has also confirmed that the Noticee had
obtained SCORES authentication on November 05, 2012 and had resolved the
3 pending investor grievance (as mentioned in the SCN) before the issuance of
SCN and 1 pending investor grievance on the next working day after receiving
of SCN on July 29, 2013.
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Adjudication Order in respect of M/s Coventry Coil-o-Matic (Haryana) Limited

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13. Since, the Noticee had obtained SCORES authentication and had taken
necessary steps of resolving the pending investor grievance before the
issuance of SCN; I hold that the allegation of not resolving investor grievances,
as alleged in the SCN, does not stand established.
ISSUE 2: Whether the Noticee is liable for monetary penalty under Section
15C of the SEBI Act, 1992?
14. The provisions of Section 15C of the SEBI Act, 1992, read as under:
15C Penalty for failure to redress investors' grievances: If any listed
company or any person who is registered as an intermediary, after having
been called upon by the Board in writing, to redress the grievances of
investors, fails to redress such grievances within the time specified by the
Board, such company or intermediary shall be liable to a penalty of one lakh
rupees for each day during which such failure continues or one crore rupees,
whichever is less.
15. Since the allegation against the Noticee of not resolving the investor grievance
pending against it has not been established; therefore, the Noticee is not liable
for monetary penalty under Section 15C of the SEBI Act, 1992.
ISSUE 3: What quantum of monetary penalty should be imposed on the
Noticee taking into consideration the factors mentioned in Section 15J of
the SEBI Act, 1992?
16. Since, the Noticee is not liable for monetary penalty in the instant matter, this
issue deserves no consideration.
ORDER
17.

In view of my findings noted in the preceding paragraphs, I hereby dispose of

the Adjudication Proceedings initiated against the Noticee vide Show Cause
Notice dated July 19, 2013.

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18. In terms of the provisions of Rule 6 of the SEBI (Procedure for Holding Inquiry
and Imposing Penalties by Adjudicating Officer) Rules 1995, copies of this
Order are being sent to the Noticee and also to Securities and Exchange Board
of India.

Date: February 23, 2015

Place: Mumbai

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Jayanta Jash
Adjudicating Officer

Adjudication Order in respect of M/s Coventry Coil-o-Matic (Haryana) Limited

February 23, 2015

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