Vedanta to appeal against SEBI order levying ₹78 crore penalty

Anil Agarwal-led Vedanta has decided to contest the SEBI order of levying a penalty of ₹78 crore on delayed dividend payments to Cairn UK Holdings (now Capricorn UK Holdings) Ltd (CUHL).

The dividend payment to CUHL was withheld due to a tax dispute between Cairn UK and the Indian Government, and the dividend of ₹667 crore was deposited in an “unpaid dividend account” as per law.

When Cairn UK reached a settlement with the Government in its tax dispute, all dues were cleared including the said dividend amount. Moreover, as per the settlement with the government, Cairn UK undertook the process to surrender its rights to claim interest on tax refund (arising on account of this dividend), said Vedanta in a statement on Wednesday.

“There was absolutely no intent on the part of Vedanta to withhold the dividend payment from CUHL. Vedanta has paid out dividend of over ₹84,000 crore to shareholders in the last ten years.” it said.

The amount of ₹667 crore is a very small amount in the context of the amount of dividend Vedanta pays, said the company. Vedanta will appeal the SEBI order before the appropriate forum, it added.

Besides levying a penalty, the SEBI on Tuesday barred the firm’s entire Board, including Anil Agarwal’s brother Navin and daughter Priya, from accessing the capital market.

Interestingly, in 2019, SEBI closed the complaint by CUHL after Vedanta said that the dividend was withheld due to an IT attachment of assets.

However, CUHL had moved the Supreme Court in 2019 against the SEBI order. In 2022, the Apex Court ordered SEBI to initiate an enquiry and complete the same within a specific time frame. SEBI started hearing the case afresh and has now levied the penalty on Vedanta.

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