2022 (3) TMI 1540 - AT - SEBI

Compulsory delisting against the company - Payment of reinstatement fee to the Exchange - company was granted 30 days time to submit all pending compliances including payment of all outstanding Exchanges dues and to complete the formalities for revocation of suspension of securities of the company - Whether appellant entitled to pay annual listing fee during the suspension period? - as argued appellant is not entitled to pay the reinstatement fee as demanded by the respondent - HELD THAT - We find that reinstatement fee is one of the requirements for purpose of revocation of suspension in the trading of securities. This requirement of payment of reinstatement fee is also gathered from the Circular dated December 19, 1994 issued by SEBI and Master Circular of listing dated January 18, 2019 wherein it becomes obligatory for a Company whose securities continue to be listed at the Exchange to pay annual listing fee as well as reinstatement fee for considering revocation of suspension in trading in the securities of the company. The respondent is entitled to levy fee for the purpose of revocation of suspension of trading in securities and the same is binding on companies desirous of such revocation. The Byelaw also empowers the respondent to reinstate suspended securities subject to conditions as it deems fit. Further in Clause 43 of the Listing Agreement the respondent is entitled to levy reinstatement fee upon companies seeking revocation of suspension of trading in securities. We do not find any error in the interim order passed by the Delisting Committee. The appeal fails and is dismissed with no order as to costs.

Summary

Issues:
Interim order by Delisting Committee for non-compliance and potential delisting, Obligation to pay annual listing fee during suspension period, Requirement to pay reinstatement fee for revocation of suspension.

Interim Order Challenge:
The appeal was filed against an interim order by the Delisting Committee of the respondent BSE Ltd., granting 30 days to complete pending compliances, failing which compulsory delisting would proceed. The appellant's securities were suspended in 2002, leading to subsequent regulatory actions and non-compliances.

Annual Listing Fee Obligation:
The main contention was the appellant's argument against paying annual listing fees during the suspension period. However, the tribunal found that listing and trading are distinct, and the appellant was obligated to pay the fee as per regulatory provisions and the listing agreement.

Reinstatement Fee Requirement:
The appellant also challenged the requirement to pay reinstatement fees for revocation of suspension. The tribunal cited regulatory frameworks, including SEBI regulations and the Listing Agreement, to establish the obligation to pay reinstatement fees as part of the revocation process.

Legal Analysis:
The tribunal referred to relevant provisions of the Securities Contracts Regulation Act, Listing Obligations and Disclosure Requirements Regulations, and BSE Bye-laws to support the obligation to pay fees, fines, and penalties. The tribunal emphasized that the appellant's failure to comply with listing requirements justified the interim order.

Conclusion:
The tribunal upheld the interim order, stating that the appellant was required to pay fees as per the regulatory framework, including annual listing fees during suspension and reinstatement fees for revocation. The appeal was dismissed, and no costs were awarded. The order was digitally signed for compliance, and certified copies were made available upon payment.

This detailed analysis of the judgment highlights the issues, legal reasoning, and the tribunal's decision regarding the challenges raised in the appeal.