What are the Penalties If compliance not done in nSE and bSE social stock exchange?
The penalties for non-compliance in a social stock exchange (SSE) can vary depending on the regulatory framework established by the relevant authorities or the SSE itself. However, some common penalties or consequences for non-compliance might include:
In the same way as any other listed entity in case of noncompliance with any SEBI provisions or guidelines, SEBI has the option of enforcing action including administrative warning, penalties imposed under Chapter VIA of the SEBI Act, or action u/s 11 of SEBI Act for the purpose of disqualification and/or fines.
Exemption under Income-tax Act, 1961: If Registration Certificate udder section 12A/ 12AA/ 12AB/ 10(23C)/10(46) under Income-tax Act, 1961
- Registration Certificate under section 12A/ 12AA/ 12AB/ 10(23C)/10(46) to be valid for at least the next 12 months.
- Details regarding pending notices or scrutiny cases from all regulatory and statutory authority shall be disclosed at the time of making the application for the registration.
- Fines or penalties if imposed shall be disclosed as paid or appealed within 7 days. The Stock Exchanges shall have the right to refuse registration of those applicants, if the notices/ scrutiny cases are grave and debilitating enough to endanger the registration of the NPO under the Income-tax Act, 1961or other relevant laws.
If a listed entity on the BSE Social Stock Exchange (SSE) fails to comply with any of the provisions or guidelines, the Securities and Exchange Board of India (SEBI) may take enforcement actions. These actions may include:
Issuing an administrative warning
Imposing penalties under Chapter VIA of the SEBI Act
Taking action under Section 11 of the SEBI Act for debarment and/or penalty
PENALTIES UNDER BSE Social stock exchange
This List is inclusive as per Imposing penalties under Chapter VIA of the SEBI Act
15A. Penalty for failure to furnish information, return, etc. – If any person, who is required under this Act or any rules or regulations made thereunder,-
If fails to furnish any documents, furnish any information, return or report and not maintain books of accounts to the board then liable to a penalty 1 lakhs rupees for each day during which such failure continues or one crore rupees, whichever is less.
15B. If any agreement with clients by any person who is registered into an agreement with clients, fails to enter into such agreement, he 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.
15C.If any listed company or registered intermediary fails to redress grievances of investors 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.
15HA.If anyone indulges in fraudulent and unfair trade practices relating to securities, then he shall be liable for a penalty of twenty-five crore rupees or three times the net amount of the profits, whichever amount is higher.
15HB. Whoever contravenes any provisions of this Act, rules made under it or directions issued by the Board under them for which no separate penalty is prescribed shall be punishable with an amount which may extend up to one crore rupees.
PENALTIES UNDER NSE SSE
This List is inclusive as per Imposing penalties under NSE SSE
Members failing to fulfil their funds obligations and members failing to fulfil their securities deliverable obligations to Clearing Corporation would be subjected to the following penalty structure to Clearing Corporation shall be subjected to the following penalty structure:
|
S. NO TYPE OF NON-FULFILLMENT PENALTY CHARGE % PER DAY |
|
1) Funds shortages 0.07% |
|
2) Security Shortages 0.05% |
Securities Deposit shortage
Members not fulfilling the security deposit requirement for continued membership would be subjected to a penalty charge of 0.07% per day.
Common Grounds for Penalties
- Insider Trading: Trading based on non-public, material information.
- Market Manipulation: Actions intended to deceive or mislead other market participants.
- Disclosure Failures: Inadequate or delayed disclosure of material information.
- Non-compliance with Listing Requirements: Failure to meet the financial and governance standards required for maintaining listing status.
What Are the Consequences of Non-Compliance to Social Enterprise?
Compliance failure is expensive for social enterprises. It can also be a problem for employees and employers as well as attracting dissatisfaction from shareholders together with government fines. Some of the effects of non-compliance on organizations are:
When employees feel unwanted, it can lead to low productivity over time if they work too much or are paid late.
Impacts an organization’s reputation because also an organization’s reputation is spoiled if it does not comply. An incident could go viral online and even negatively influence the quality of employees that you can attract.
It is possible for the social stock exchange to invite penalties.
In case social enterprises are non-compliant with the laws that ensure protection of employees and their entire registration documents in addition to this not complying with the requirements set by the social economy stock exchange to enable them register into it implies that can be punished by being penalty.
Conclusion:
If you do not comply with the provisions of social stock exchange, then you can face a heavy cost penalty in the NSE or BSE, and all provisions of the penalty are simultaneously applicable to the SSE of the NSE or BSE wherever you register for listing.
DISCLAIMER: The information provided in this article is intended for general informational purposes only and is based on the latest guidelines and regulations. While we strive to ensure the accuracy and completeness of the information, it may not reflect the most current legal or regulatory changes. Taxpayers are advised to consult with a qualified tax professional or you may contact to our tax advisor team through call +91-9871990888 or info@ngopilot.in.