Order in the matter of MTZ Industries Ltd.

WTM/RKA/OIAE/99/2014 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA ORDER Under section 11B of the Securities and Exchange Board of India Act, 1992 in the matter of MTZ Industries Ltd. In respect of M/s. MTZ Industries Ltd., Mr. Bhushanlal Amaranth Gupta, Mr. Sanjay Babubhai Shah, Mr. Pradip Sitaram Talawadekar, Mr. Arvind Krishanparkash Oberoi, Mr. Anand S. Shah and Mr. S. C. Roongta. 1. M/s. MTZ Industries Ltd. (hereinafter referred to as 'MTZ') is a company incorporated under the Companies Act, 1956 having its registered office at MTZ Industries Ltd. Plot No A – 126 MIDC Industrial Area, near MIDC Telephone Exchange, Dombivli (E), Thane 421 203, Maharashtra. The shares of MTZ are listed on Bombay Stock Exchange Ltd. (BSE). It has been observed from the website of Ministry of Corporate Affairs that there are six directors of MTZ, namely, Mr. Bhushanlal Amaranth Gupta, Mr. Sanjay Babubhai Shah, Mr. Pradip Sitaram Talawadekar, Mr. Arvind Krishanparkash Oberoi, Mr. Anand S. Shah and Mr. S.C. Roongta. 2. SEBI vide circular no. CIR/OIAE/1/2012 dated August 13, 2012 directed all companies whose securities are listed on stock exchanges to obtain SCORES authentication by September 14, 2012. However, certain companies including MTZ did not obtain SCORES authentication within the time period specified in the aforementioned circular.

Therefore, a public notice was issued on January 13, 2013, advising inter alia, MTZ to obtain SCORES authentication within seven days from the date of the advertisement, failing which SEBI would be constrained to initiate appropriate enforcement actions. However, MTZ still failed to obtain SCORES authentication. It was also observed that eight investor complaints were pending against MTZ. SEBI vide its letter dated February 15, 2013 once again advised MTZ to obtain SCORES authentication and to redress the investor complaints pending against it but the said letter returned undelivered. 3. Since MTZ did not obtain SCORES authentication and failed to redress the investor grievance, SEBI issued Show Cause Notices (SCNs) dated March 28, 2013 and April 26, 2013, to MTZ and its directors, respectively, calling upon them to show cause as to why suitable directions including the direction to restrain them from accessing the securities market for a specified period should not be issued under section 11B of the SEBI Act. Mr. Bhushanlal Amaranth Gupta and Mr. Pradip Sitaram Talawadekar replied to the SCN, and submitted that they have resigned from the post of MTZ's director in 2009. MTZ and its remaining directors did not file their replies to the SCN.

In the matter of M/s. MTZ Industries Ltd.

4. Subsequently, a letter was written to RoC - Mumbai to confirm the status of MTZ. The Registrar of Companies, Ministry of Corporate Affairs vide its letter dated May 27, 2014 confirmed that, MTZ is under liquidation and Hon'ble High Court of Bombay has appointed Official Liquidator as the liquidator with effect from July 19, 2010 in Company Petition No. 131 of 2002. 5. I note that in the present matter, the winding up order had been passed on July 19, 2010 which is prior to the SCNs dated March 28, 2013 and April 26, 2013 issued in the present matter. I further note that section 446 of the Companies Act, 1956 mandates that “When a winding up order has been made or the official liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced … against the company except by leave of the (Tribunal) …”. 6. I am of the opinion that the present proceedings falls under the scope of the phrase “other legal proceedings” used in the section 446. Further I note that there is no material on record to suggest that leave of the Court has been taken before starting the present proceedings. 7. I, therefore, find that the present proceedings initiated against MTZ Industries Ltd. and its directors are infructuous and against the mandate of section 446 of the Companies Act, 1956. The matter is, accordingly, disposed of.

Date: 13th August, 2014 RAJEEV KUMAR AGARWAL Place: Mumbai WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA