CO/IMD/ DOF-1/401/2010

BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA, MUMBAI

CONSENT ORDER
ON THE APPLICATION SUBMITTED BY
RELIGARE ASSET MANAGEMENT COMPANY LIMITED
(SEBI Regn. No. INP 000000738)
IN THE MATTER OF
RELIGARE ASSET MANAGEMENT COMPANY LIMITED
(CONSENT APPLICATION NO. 1767/2010)

1. Securities and Exchange Board of India (hereinafter referred to as ‘SEBI’) conducted an

inspection of the books of accounts, documents and other records of Religare Securities
Limited (formerly known as Fortis Securities Limited) ( hereinafter referred to as ‘RSL’), a
portfolio manager, in the month of January 2006 for the period September 01, 2004 to
December 31, 2005. SEBI, forwarded copy of the inspection report to RSL and RSL was
further advised to offer its comments in respect of the observations of the said inspection
report. Pursuant to the receipt of the comments of RSL, SEBI, inter alia, vide order dated
June 13, 2007 appointed an Enquiry Officer under the provisions of the Securities and
Exchange Board of India (Procedure for Holding Enquiry by Enquiry Officer and Imposing
Penalty) Regulations, 2002 (since repealed) to enquire into the alleged violations committed
by RSL, as stated therein. The Enquiry Officer, vide report dated June 25, 2009
recommended the imposition of penalty, prohibiting RSL from launching any new scheme
for a period of one month. The Enquiry Officer, inter alia, observed that the applicant has
not complied with (a) clause 1.1 of the Code of Advertisement and clause c(iii) of SEBI
Circular No. 1(93-94) dated October 20, 1993 and (b) clauses 1 and 5 of SEBI Circular No.
IMD/PMS/CIR/1/21727/03 dated November 18, 2003.

2. Pursuant to the submission of the Enquiry Report, a notice IMD/DOF-

1/MC/180425/2009 dated October 22, 2009 was issued by SEBI under regulation 28 of the

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SEBI (Intermediaries) Regulations, 2008 to RSL asking it to show cause as to why the
penalty as designated member considers appropriate, shall not be imposed on it. A copy of
the Enquiry Report was also forwarded to RSL along with the said show cause notice. RSL
vide letter dated November 30, 2009 submitted its reply to the show cause notice.
Subsequently, the Certificate of Registration of RSL as a portfolio manager got endorsed in
the name of Religare Asset Management Company Limited (herein after referred to as the
‘applicant’) on December 21, 2009. A personal hearing in the matter was scheduled on
January 08, 2010, which was duly attended by the representative of the applicant.

3. While the above proceedings were in progress, the applicant vide letter dated January 12,
2010 proposed settlement of the aforementioned proceedings through a consent order in
terms of SEBI circular No. EFD/ED/Cir-1/2007 dated April 20, 2007. The applicant vide
its letter dated March 11, 2010 proposed revised consent terms for the proceedings
mentioned above. The High Powered Advisory Committee (HPAC) constituted by SEBI,
considered the consent terms proposed by the applicant and recommended the case for
settlement on payment of Rs.5,00,000/- (Rupees Five Lakh only) towards settlement
charges. The said application was thereafter examined by the panel of whole time members
of SEBI and having considered the facts and circumstances of the case, the panel of whole
time members rejected the consent proposal of the applicant. The applicant was accordingly
informed about rejection of consent proposal vide letter dated May 18, 2010. The applicant
thereafter vide letter dated May 21, 2010 filed revised consent proposal for settlement of the
aforementioned proceedings through a consent order in terms of SEBI circular No.
EFD/ED/Cir-1/2007 dated April 20, 2007. The said application was examined and
considered by the panel of whole time members of SEBI. The panel of whole time members
of SEBI having considered facts and circumstances of case accepted the consent terms
proposed by the applicant on payment of Rs.10,00,000/- (Rupees Ten Lakh only) towards
settlement charges. Accordingly, SEBI vide letter dated September 17, 2010 communicated
applicant about acceptance of its consent proposal.

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