Skip to content

CS Executive · Capital Market and Securities Laws · Delisting of Equity Shares

Tapovan Cements Ltd announces a voluntary delisting. The acquirer fails to make payment of consideration to shareholders who tendered shares in the offer. Under the SEBI Act, 1992 text on takeover-related defaults, what penalty exposure arises for such failure?

Failure to pay consideration to shareholders who sold under an offer attracts a penalty under Section 15H of the SEBI Act. It is not less than ten lakh rupees and may extend to twenty-five crore rupees or three times the profits made, whichever is higher.

  1. AA penalty not less than ten lakh rupees, extendable to twenty-five crore rupees or three times the profits made, whichever is higherCorrect
  2. BA fixed penalty of one lakh rupees
  3. COnly a warning from the stock exchange
  4. DImprisonment without any monetary penalty

Explanation

Section 15H of the SEBI Act covers failure to make payment of consideration to shareholders who sold shares pursuant to a letter of offer. The penalty is at least ten lakh rupees and may extend to twenty-five crore rupees or three times the profits made from the failure, whichever is higher.

Did you get it right without looking?

One question tells you little. A timed set on Delisting of Equity Shares shows your real accuracy, how long you take and where you lose marks.

Practise Delisting of Equity SharesFree diagnostic mock

More Delisting of Equity Shares questions