Order in the matter of M/s. Mishtann Foods Ltd (previously known as HICs Cements Ltd.)

Under Sections 11, 11(4) and 11B(1) of the Securities and Exchange Board of India Act, 1992

In respect of: S.No. Names of the Noticee PAN/CIN

HICs Cements Ltd. (now known PAN: AAACH5335G 1. as Mishtann Foods Ltd.) CIN: L15400GJ1981PLC004170

PAN: Not Available 2. Mr. Ketan Kantilal Khimani PAN: Not Available 3. Mr. Kantilal Jagjivan Khimani PAN: Not Available 4. Mr. Prashant Kantilal Khimani

IN THE MATTER OF HICs Cements Ltd. now known as Mishtann Foods Ltd. (The above entities are collectively referred to as “Noticees’ and individually by their respective name or Noticee nos.)

Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

1. In order to dispense a better, speedy and proper redressal of investors’ complaints against the listed companies, Securities and Exchange Board of India (hereinafter referred to as “SEBI”) in the year 2011, came up with an online portal/mechanism called the SEBI Complaints Redress System (hereinafter referred to as “SCORES”). This mechanism enabled prompt online transmission of the complaints to the respective listed companies for redressal. The listed companies, after having received the complaints are required to take appropriate steps to resolve the complaints and upload their Action Taken Reports (hereinafter referred to as “ATR”) in SCORES for the benefit of the complainants. The companies can also upload the ATR by logging in to SCORES by using their SCORES authentication (consisting of user ID and password), which can be obtained by the company after submitting the necessary details to SEBI. Similarly, investors can also upload their complaints and check the status thereof from time to time by logging into SCORES by using their ID and password which they receive after registration with SCORES. The online grievance redressal system facilitates speedy disposal and redressal of investors’ grievances by the listed companies under close monitoring by SEBI.

2. In this regard, SEBI has issued circulars dated viz. June 3, 2011, August 13, 2012 and April 17, 2013, informing the listed companies about SCORES mechanism and directing them to obtain SCORES authentication and further to take necessary steps so as to be able to resolve the complaints within the stipulated days in terms of the guidance issued to them from time to time. Companies have also been directed to upload the ATR on SCORES for view by the investor and SEBI. It has also been informed that failure to obtain SCORES authentication and update the ATR in SCORES will be treated as non-redressal of investor complaint and in case of failure to comply with the above instructions, SEBI would be constrained to initiate appropriate actions as per law against such erring companies/entities.

Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

3. In the instant case, I note that apart from the above circulars which were required to be complied with by the companies, vide letter dated April 30, 2013, HICs Cements Ltd. now known as Mishtann Foods Ltd. (hereinafter referred to as “the Noticee Company”) was informed about the SEBI circular No. CIR/OIAE/1/2012 dated August 13, 2012 in terms of which all companies including the Noticee Company whose securities were listed on stock exchanges were advised to obtain SCORES authentication by September 14, 2012. Attention was also drawn that companies whose securities were listed on the stock exchange and against whom investors grievances were pending on SCORES were required to take appropriate necessary steps in terms of instruction stated in the letters/ circulars issued in this regard. It was also advised to the Noticee Company intimating about the steps to be taken towards seeking SCORES authentication for resolution of the complaints through SCORES mechanism.

4. I note that despite the aforesaid circulars and letters, no information has been received from the Noticee Company and the investor complaints against the company have remained un-redressed. Therefore, a Show Cause Notice (hereinafter referred to as “SCN”) was issued to the Noticee no. 1 Company and its Directors (Noticees no. 2 to 4) dated February 3, 2015 asking it as to why directions including, restraining it from accessing the Securities Market should not be passed against it for their non-compliances as per the allegations made in the SCN.

5. The aforesaid SCNs however could not be delivered to the Noticee Company. Further, in the interest of principles of natural justice, an opportunity of Personal Hearing was also scheduled for the Noticees on February 26, 2019, however, the letter informing them about the date of Personal Hearing could also not be delivered through post. Thereafter, vide public notice dated February 19, 2019, the Noticees were informed about the personal hearing scheduled on February 26, 2019 before the competent authority.

Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

Subsequently, when it was brought to SEBI’s notice that the Company’s name has changed to Mishtann Foods Ltd., the SCN to the Company and Directors was delivered at the new address of the Company, and the Personal hearing for the Noticees was scheduled on January 8, 2020.

6. On the scheduled date of hearing i.e. January 8, 2020, Authorised Representatives appeared on behalf of the Noticee no. 1 (Company) who presented their oral arguments and stated that they will submit a written reply on the lines of oral arguments advanced by them on behalf of the Company. However, none of the other Noticees appeared for Personal hearing on the above mentioned scheduled date. I note that the Company has subsequently submitted a written reply dated January 17, 2020, making therein the following submissions: (a) The Notices issued by SEBI to the Company dated October 11, 2011, November 22, 2011, January 16, 2012, February 12, 2012, April 30, 2013 and February 3, 2015 were not delivered to the Company as the Registered Office was shifted to Ahmedabad. (b) All the Notices were mailed at the earlier registered address of the Company and therefore, they were unable to respond to the same. (c) The Noticee Directors (Noticees no. 2 to 4) have resigned from their Directorship in the Company. (d) Pursuant to resignation of the old directors, the existing Directors have resolved the pending grievances and as on date, there are no pending complaints to be resolved. (e) The Company has obtained the SCORES authentication since its listing on BSE Limited. (f) The Complaints alleged to be pending as per the SCN have already been resolved by the Company on 31.7.2015.

Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

7. Keeping in view the facts stated above, I proceed to deal with the matter, based on the materials available on record. I have considered the SCN, the annexures to the SCN, the submissions made by the Noticee no. 1 and other materials on record.

8. It is a mandatory requirement that a listed company is under an obligation to timely redress all complaints of its shareholders & investors. I note from the record that the Noticee Company was required to redress the pending complaints and update the ATR in timely manner in terms of the relevant circulars issued by SEBI from time to time governing the subject of redressal of investor’s grievances. The Noticee Company has submitted its ATR and furnished explanation about the delay in redressing some of the pending complaints as well for the non-receipt of Notices from SEBI advising them to resolve the pending complaints. I find that there was a change in the registered office of the Noticee Company and hence, they could not receive the Notices from SEBI as well the SCN issued to them. Further, it is also submitted that the Company has subsequently resolved all the pending complaints and has even obtained the SCORES authentication. It has also been submitted that there are no pending complaints with the Company as on date.

9. It may be noted that protection of investors’ interest is a key to secure a successful Securities Market, hence listed companies should adopt active and prompt approach towards resolving investors’ complaints. As regards the importance of taking SCORES authentication and resolution of investors complaints, I find it apt to refer and rely on the observation recorded by Hon’ble Securities Appellate Tribunal (hereinafter referred to as “SAT”) in M/s. Golden Proteins Ltd. v. SEBI (DOD: 11.09.2015 in Appeal No. 334 of 2015), wherein Hon’ble SAT has recorded “This Tribunal has consistently held that timely redressal of the investors' grievances by the companies is of utmost importance. Keeping this importance in mind, SEBI by circular dated August 2, 2011, SEBI introduced a system of processing investors' complaints in a Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

centralized web based complaints redress system, which is commonly known as 'SCORES'. Under this system, a centralized database of all the complaints and their online movement to the concerned intermediaries is monitored. Similarly, online upload of action taken reports (ATR) by the concerned entities and its viewing by investors of the action on the complaints and their current status etc. all are displayed. Violation of such an important regulatory measure cannot be taken lightly in the facts and circumstances of the present case.”

10. In this case, I find that though there was some delay on the part of the Noticees in obtaining the SCORES registrations and in obtaining log in id and password so as to expedite the redressing of complaints in terms of the circulars issued from time to time, the same was ultimately obtained and pending complaints have been redressed. I also note that a part of delay in redressing the complaints was also on account of the fact that they did not receive the letters and Notices issued to them by SEBI due to change of registered office and due to change in name and management of the Company. It is undoubtedly expected from the Noticee Company to respond to the complaints by updating the ATR within a reasonable period of time and redress the grievance of investors, however, given the fact that the communications from SEBI were not reaching the Company due to its change of name and address and the fact that the Company and its new Directors have redressed the grievances hence, its conduct can be stated to be reasonably satisfactory and compliant with SEBI’s instructions.

11. During the proceedings, Noticee Company was asked to submit the updated status of the pending complaints. From the submissions and other materials as made available pertaining to the pendency of complaints, it has been brought to my notice that there are some complaints still pending against the Company for resolution. From the perusal of the materials, it is observed that though the initial

Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

complaints based on which the instant proceedings have been initiated are no more pending and have been duly resolved, there are certain complaints which are still pending for resolutions by the Company. I also note that Noticee has been reminded about the pendency of these complaints vide e-mail dated February 17, 2020. It does not require a reiteration that timely redressal of the investors' grievances by the companies is of utmost importance and any listed entities should not sit over the investors complaint beyond a reasonable period without any plausible reason. Entities are expected to take timely and speedy steps to resolve the investors grievance at the shortest possible time frame.

12. To conclude, I find that although the initial complaints have been resolved and are no more pending for any action, a number of subsequent complaints are still pending for redressal on the part of the Noticee Company which need to be urgently acted upon by the Company. Therefore, I in exercise of powers conferred upon me under Sections 11, 11(4), 11B (1) read with Section 19 of the Securities and Exchange Board of India Act, 1992, in order to protect the interest of investors and the integrity of the Securities Market dispose of the present proceeding with the following directions:

a) The Noticee Company is warned to be careful in resolving the investors’ complaints within the time line as specified in the circulars issued by SEBI from time to time. b) As regards the complaints still pending for resolution/redressal for which the Company has been reminded vide email dated February 17, 2020, the Noticee Company is directed to take urgent steps to resolve those pending complaints and file a satisfaction report to SEBI within a period of 45 days from the date of this order.

13. In the event of failure to file the satisfaction report or non-resolution of the pending complaints, it shall be open to SEBI to examine the nature of complaints and the steps taken by the Noticee to Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.

resolve these complaint and to take further necessary action against the Company as may be deemed fit as per law.

14. The Order shall come into force with the immediate effect.

15. A copy of this order shall be forwarded to the Noticees, all the recognized Stock Exchange, depositories and registrar and transfer agents. -Sd-

DATE: FEBRUARY 20, 2020 S. K. MOHANTY PLACE: MUMBAI WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA

Order in the matter of HICs Cements Ltd. now known as Mishtann Foods Ltd.