Sebi to pass fresh order in UBHL restatement of accounts case

New Delhi: Market regulator Sebi will pass fresh orders in the matter pertaining to restatement of financial accounts by five companies, including Vijay Mallya-led United Breweries Holdings Ltd (UBHL).

In this regard, a direction has been issued by the Securities Appellate Tribunal (SAT) today after a submission made by Sebi.

Last year, the Securities and Exchange Board of India (Sebi) had asked Mallya's group holding company UBHL to restate financial accounts for two previous years to address issues flagged by the auditors.

The watchdog had also asked four other companies, Filatex India, GOL Offshore, Autolite (India) Ltd and Alps Industries, to restate their financials.

Challenging Sebi's orders, the five companies had separately approached SAT.

During the hearing, Sebi's counsel cited a decision by the regulator's board during its meeting this month and requested the tribunal to quash the impugned orders and allow passing of fresh orders.

At its meeting on March 12, Sebi board had decided to put in place a mechanism to review the audit qualifications contained in the audit reports.

The new mechanism would be applicable for new as well as earlier cases.

Acceding to Sebi counsel's request, SAT said "impunged orders in these appeals are quashed and set aside the earlier orders given by Sebi and with liberty to the regulator pass fresh order on merits and in accordance with law".

As per the new mechanism, listed entities would be required to disclose the cumulative impact of all the audit qualifications on relevant financial items in a separate form called 'Statement on Impact of Audit Qualifications' instead of the present form.

Such disclosures would have to be made in a tabular form along with annual audited financial results filed in terms of listing regulations.

SAT's ruling also comes at a time when Vijay Mallya is under the scanner of Sebi over issues at his various group companies.