2021 (11) TMI 1176 - SCH - SEBI

Penalty u/s 15HA of the SEBI Act - Special Court at Calcutta jurisdiction to entertain the said complaint and to proceed against the petitioner - HELD THAT - During the pendency of the proceedings before this Court and pursuant to order of this Court 2021 (3) TMI 1437 - SC ORDER petitioner has deposited the penalty amount of Rs.1 Crore. In view of such payment, what remained, is only with regard to interest on the said amount of Rs.1 Crore penalty imposed by the Adjudicating Authority. It is the case of the petitioner that the petitioner, an innocent young entrepreneur, entered into security market immediately after completing her MBA Course. It is stated that with great difficulty, the petitioner could mobilize the penalty amount and paid the same. As much as, Adjudicatory Order was passed as early as on 30.04.2012 and further, the petitioner has already paid the entire penalty amount of Rs.100 lakhs during the pendency of this Petition, and to put quietus to the litigation, we deem it appropriate to dispose of the Special Leave Petition by directing the petitioner to deposit a further sum of Rs.10 lakhs towards interest, within a period of eight weeks from today. Upon such deposit, the criminal proceedings initiated against the petitioner on the file of the 5th Special Court, Calcutta stand quashed. It is made clear that this order is passed having regard to peculiar facts and circumstances of the case and the same shall not be treated as precedent for any other case.

Summary

Issues:
1. Imposition of penalty under SEBI Act
2. Jurisdiction of Special Court at Calcutta
3. Payment of penalty amount and interest

Imposition of penalty under SEBI Act:
The Adjudicating Officer imposed a penalty of Rs.1 Crore on the petitioner under Section 15HA of the SEBI Act. The order specified the payment method and timeline for the penalty amount. The petitioner failed to pay the penalty, leading to the filing of a complaint by SEBI. The petitioner, during the proceedings, deposited the penalty amount. The court directed the petitioner to pay an additional sum of Rs.10 lakhs towards interest to conclude the matter.

Jurisdiction of Special Court at Calcutta:
SEBI filed a complaint against the petitioner in the 5th Special Court at Calcutta for non-payment of the penalty. The petitioner challenged the jurisdiction of the Calcutta court, arguing that the cause of action did not arise there. The High Court dismissed the revision petition, upholding the jurisdiction of the Special Court at Calcutta. However, after the petitioner deposited the penalty amount, the court quashed the criminal proceedings initiated by the Special Court at Calcutta.

Payment of penalty amount and interest:
The petitioner, a young entrepreneur, paid the penalty amount of Rs.1 Crore during the pendency of the case. Subsequently, the court directed the petitioner to deposit an additional Rs.10 lakhs towards interest within eight weeks. Upon this payment, the criminal proceedings against the petitioner were quashed. The court clarified that the decision was based on the unique circumstances of the case and should not set a precedent for other cases.

This judgment addresses the imposition of a penalty under the SEBI Act, the jurisdiction of the Special Court at Calcutta, and the payment of the penalty amount and interest by the petitioner.