Sebi gives suspected shell companies a chance to be heard
Mumbai: Two days after asking stock exchanges to act against 331 listed entities suspected to be shell companies, the Securities and Exchange Board of India (Sebi) seemingly softened its stance on Wednesday, giving the firms an opportunity to be heard. The markets regulator issued a second communique to the exchanges, asking them to look at the tax returns and financials of the companies for the past three years, two persons with direct knowledge of the matter said on condition of anonymity. Exchanges were directed to seek documents from the companies and hear them out, said the first person. “If the verification does not throw up red flags, exchanges will report the same to Sebi. If the financials throw up concerns, then the companies will undergo an audit and other steps mentioned in 7 August circular,” said the second person. “This is more on the lines of Sebi giving exchanges steps that need to be followed,” this person added. A statement from NSE said only 48 of the 331 firms fl