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Issues Involved:
1. Whether the appellants should be treated as a single unit/group for the purpose of regulation 10 of the SAST Regulations, 1997. 2. Whether there was a violation of the norm of creeping acquisition of 5% additional voting rights prescribed in Regulation 11(1) of the SAST Regulations, 1997, and the appropriate penalty for any such violation. Summary: Issue 1: Regulation 10 of the SAST Regulations, 1997 The appellants, part of the promoter group of the Company, were alleged to have violated regulation 10 of the SAST Regulations, 1997, which deals with the acquisition of 15% or more of the shares/voting rights of any company. The Respondent argued that KLL's individual shareholding increased from 10.52% to 17.16% on March 12, 2007, necessitating a public announcement. However, the Tribunal held that KLL acted in concert with the other appellants, and thus, the collective shareholding should be considered. Since the collective shareholding of the promoter group had always been more than 15%, there was no violation of regulation 10. The Tribunal noted that the SAST Regulations, 1997 allow persons/entities to act in concert and that specific provisions making an individual liable for a public offer in case of increased individual shareholding were absent in the 1997 regulations but included in the SAST Regulations, 2011. Therefore, the finding against KLL was set aside. Issue 2: Regulation 11(1) of the SAST Regulations, 1997 Regulation 11(1) pertains to creeping acquisition, allowing an acquirer with persons acting in concert to acquire shares in the range of 15% to 55% of the shares/voting rights in a company, with a limit of 5% per financial year. The Tribunal found that the appellants' shareholding increased by 8.38% on March 12, 2007, due to two separate transactions, violating regulation 11(1). However, considering the appellants' bona fide actions and the inordinate delay of about 5 years by the Respondent in issuing the show cause notice, the Tribunal deemed a public announcement at this stage would be superfluous. Instead, a monetary penalty of Rs. 25 lac was imposed on the appellants for the breach of regulation 11(1) on March 12, 2007. The appellants were directed to deposit the penalty amount with the Respondent within six weeks from the date of the order.
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