Case Law Analysis
|Securities Appellate Tribunal
Regulation 27(1) sub-clauses (i)-(iii) apply to borrowers, subsidiaries and associates of a promoter | SEBI CRA penalty set aside : SAT
The SAT ruled that the conditions in sub-clauses (i)-(iii) of SEBI’s Regulation 27(1) bind not only the promoter’s direct entities but also borrowers, subsidiaries and associates linked to the promoter. This interpretation broadens the scope of prohibited rating assignments for credit rating agencies, exposing them to liability for ratings tied to any promoter-related borrowing.