The Securities and Exchange Board of India (Sebi) is reportedly planning a series of tough measures against promoters who violate listing norms. Those found violating norms for two straight quarters could see their properties and bank accounts attached, Mint reports.
The business daily, citing sources, said the nature of the penalty levied could also be modified to ensure that promoters of listed firms do not take the proposed norms lightly.
"The corporate finance department (of Sebi) has made certain proposals to increase the monetary penalties levied on defaulting firms and bring in some norms that will be able to penalise the promoters more than the company," Mint quoted one of the sources as saying.
Violations by listed firms could include failure to provide annual reports, shareholding patterns and financial results.
Proxy advisory firm Institutional Investor Advisory Services (IiAS) welcomed the proposed changes.
"It is a good idea to put in place a mechanism to attach accounts or assets of the promoters or the directors if the penalty amount is long due and the violation is repetitive in nature," Amit Tandon, founder and managing director of IiAS, told the daily.
If the proposed changes go through, they would be stricter than those in the Companies Act.
For the financial year ended March 31, 2016, there were 2,498 instances of non-compliance, the daily said, referring to data published by the Bombay Stock Exchange (BSE).
