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TMI Blog2013 (5) TMI 629X X X X Extracts X X X X X X X X Extracts X X X X ..... d company - borrowed a sum of Rs.48.94 crores from the appellants and pledged equity shares of SRMTL worth Rs.1,42,88,700/- (24.25% of equity capital) as security. The debt was in form of issue of Secured Optionally Fully Convertible Premium Notes by three closely held unlisted companies (Issuer Companies) for an issue price of Rs.1,00,000/- each having nominal value of Rs.1,35,000/- each. The issue was made by the Issuer Companies by way of subscription agreements and the individual premium notes issued by each are as under : (i) Shree Rama Polysynth Pvt. Ltd. 1664 (ii) East-West Polyart Ltd. 1500 (iii) Ideal Petroproducts Ltd. 1730 Total 4894 3. The Issuer Companies pledged equity shares in the capital of SRMTL and other closely held companies as security in favour of the appellants till the redemption of the Premium Notes by way of pledge agreements (Pledged Shares). The equity shares of SRMTL pledged by each of the Issuer Companies are as under : (i) Shree Rama Polysynth Pvt. Ltd. 52,49,786 (ii) East-West Polyart Ltd. 28,74,800 (iii) Ideal Petroproducts Ltd. 62,64,11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harma & Co. in their respective audit reports for the quarter July-September, 2005, had noted certain irregularities in the operations and systems of SRMTL. The Audit Committee, therefore, recommended a special investigative audit to look into the irregularities. In view of the above, a change in management was effected on the insistence of the Lender Banks. All Promoter Directors tendered their resignations in their place independent Directors were appointed. The Board of Directors of SRMTL, after considering the respective audit report of the aforesaid two accountants, accepted the recommendations of the Audit Committee and on January 28, 2006 directed a special investigative audit into the financial affairs of the company. The Board appointed M/s. R. C. Sharma & Co., to conduct the special investigative audit and submit its report. After investigation, M/s. R. C. Sharma & Co. submitted its report in three parts, comprising of two interim reports and one final report on January 30, 2006. In March-April, 2006, the aforesaid report of M/s. R.C. Sharma came in the public domain, resulting in sharp decline in prices of shares of SRMTL. It is claimed by the appellants that M/s. R.C. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 Crores as on March 31, 2005, the actual value was about Rs.263.65 Crores (out of which Rs.30.65 Crores had already crystallized). The final reason given was share price of SRMTL shares had fallen substantially from the date of making the Public Announcement. 9. Since the appellants did not receive any response from the respondent, a request was made on July 1, 2006 to the Merchant Bankers requesting them to forward an application for withdrawal of the open offer to the respondent. It appears that the Merchant Bankers vide letter dated 27th June, 2006 inter alia informed the appellants that the grounds mentioned in the letter dated 4th May, 2006 are not valid grounds, in terms of the provisions of Regulation 27 of the Takeover Code. On July 1, 2006, the appellants requested the Merchant Bankers to convey its request in a renewed form to SEBI for its consideration. The renewed request was contained in a letter dated July 01, 2006 which was sent to the Merchant Bankers as an annexure to the letter which was also sent on July 01, 2006, in reply to the letter of the Merchant Bankers dated 27th June, 2006. In the aforesaid reply, the appellants had also informed the Merchant Bankers t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants claim that the respondent did not appreciate that the fraudulent transactions, systematic embezzlement and siphoning of funds was unearthed by special investigative audit and could not have been found by an outside third party like appellants before invoking the pledge. Even any due diligence that could be conducted could only have been done on published financial information in the public domain, which has now been found to be fraudulent in character. The appellants have in the Public Announcement and Letter of Offer relied on books of accounts for last three financial years i.e. 2002-03, 2003-04 and 2004-05 of SRMTL. Even SEBI with all its compliance requirements and investigative powers was unable to unearth these instances of fraud perpetrated by promoters of SRMTL. 12. Being aggrieved by the SEBI order, the appellants filed Appeal No.74 of 2007 before the SAT. By the impugned order dated 5th June, 2008, the SAT rejected the appeal filed by the appellants. It has been held by SAT that : "(a) Regulation 27(1)(d) of the Takeover Code is to be given a strict interpretation and the words "such circumstances as in the opinion of the Board merit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Divan, are not supported by any reasons let alone sufficient reasons. The order passed by SEBI, according to him, is non-speaking and, therefore, ought to have been quashed on that ground alone. 16. The same submission was also made before the SAT. It has been rejected by the SAT by giving detailed reasons. Taking into consideration the facts and circumstances of this case, it cannot be said that Rules of Natural Justice have been violated. The special circumstances which had been elaborately set out in the two letters written by the appellants on May 4, 2006 and July 1, 2006 and the application made by the Merchant Bankers on September 22, 2006 have been summarized by Mr. Shyam Divan in the written submission which are as follows : "a. An investigation into the affairs of SRMTL by Ramesh C. Sharma & Co., Chartered Accountants, revealed that a cumulative amount of Rs. 326.48 Crores had been siphoned out of/embezzled from the coffers of SRMTL by its erstwhile Promoter Directors. Ramesh C. Sharma & Co. submitted two interim reports [in February and March 2006] and a final report (in March 2006) to arrive at its aforesaid conclusions. &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Public Announcement and filing of the draft Letter of Offer, the financial condition of SRMTL has substantially deteriorated on account of gross mismanagement and embezzlement by the promoter directors of SRMTL. It is apparent that SRMTL has lost its substratum and that chances of its revival are negligible." 18. In Paragraph 5 of the letter, a prayer is made for permission either to exempt the Regulation 3(1) (1) read with Regulation 4(2) of the Takeover Regulations or withdrawal of offer under Regulation 27, on the basis of the justification given for seeking withdrawal. The complete justification is given thereafter in Paragraph 6, which consists of sub-paragraphs 6.1 to 6.8. The ultimate reason for seeking withdrawal is given in Paragraphs 7 and 8, which are as under:- "7. Under the aforesaid circumstances, it is apparent that SRMTL has lost its substratum and that chances of its revival are negligible. The Pledgee Acquirers while enforcing the security created by pledging the shares of SRMTL, are being saddled with an additional burden of Rs.21,91,54,314 to the undue advantage of the other shareholders of SRMTL. The purpose sought to be achie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wal of the offer. Regulation 27(1) of the Takeover code is the only regulation permitting withdrawal of public offers and the same is reproduced below: ** ** **" 20. Still not satisfied, the appellants wrote to its Merchant Bankers on 1st July, 2006 requesting it to forward the letter dated 4th May, 2006 to SEBI for its consideration. In the letter, it was mentioned as follows:- "Meanwhile, we do not agree with your views even prior to SEBI's consideration of the facts presented by us. Please do note that Regulation 27(1)(c) does provide for specific approval of SEBI for withdrawal of the open offer, which is what we are seeking. Unless SEBI considers our letter and informs us of a decision not to approve the application for withdrawal, it would be premature to foreclose the options available to us by a fair application of the law. Consequently, you are requested to forward our enclosed application formally to SEBI so that SEBI can consider the same and take a decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party seeking to withdraw from the public offer is required to be given an oral hearing before an order is passed on the request for withdrawal. We also see no merit in the submission that an oral hearing was particularly necessary in the light of the fraud, which has been perpetrated by the promoters of the target company on the innocent shareholders, which will also include the appellants. Such a submission can not be accepted either on facts or in law. The appellants had made a business decision in deliberately purchasing the shares of the target company to such an extent that it had to, under the law; make the Public Announcement for purchase of other shares at the price of Rs.18.60 per share. 23. In support of his submissions on breach of Rules of Natural Justice, in his written submission, Mr. Shyam Divan has relied on Canara Bank & Ors. v. Debasis Das & Ors. [2003] 4 SCC 557. In this case, this Court reiterated the well known Rules of Natural Justice. Otherwise the particular case relied upon has no relevance to the present proceedings. In the Canara Bank's case (supra), this Court was considering the case of an employee subjected to the disciplinary proceedings. Again this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsequences", this Court reiterated the principle that the Court/Tribunal should not mechanically set aside the order of punishment on the ground that the report was not furnished to the employee. It is only if the Court or Tribunal finds that the furnishing of the report would have made a difference to the result in the case that it should set aside the order of punishment. In other words, the Court reiterated that the person challenging the order on the basis that it is causing civil consequences would have to prove the prejudice that has been caused by the non-grant of opportunity of hearing. In the present case, we must hasten to add that, in the letter dated 4th May, 2006, the appellants have not made a request for being granted an opportunity of personal hearing. Therefore, the ground with regard to the breach of rules of natural justice clearly seems to be an after thought. 26. Mr. Shyam Divan had also relied on Automotive Tyre Manufacturers Association v. Designated Authority & Ors. [2011] 2 SCC 258. The aforesaid judgment is again of no relevance in the present case. The scope and ambit of the Anti-Dumping Regulations, the Customs Tariff (Identification, Assessment & Colle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sonal hearing. Thus, the reliance on the aforesaid case is misplaced. 29. Mr. Shyam Divan then relied on Darshan Lal Nagpal (Dead) by LRs. v. Government of NCT of Delhi & Ors. [2012] 2 SCC 327. The Court in this case was considering whether the Government of NCT of Delhi could invoke Section 17(1) and (4) of the Land Acquisition Act and dispense with the rule of hearing embodied in Section 5A (2) for the purpose of acquiring certain land. In this context, the Court observed that the reasons given by NCT for invoking the emergency provision were not justified. It was observed that the documents produced by the parties including the notings recorded in the concerned file and the approval accorded by the Lieutenant Governor do not contain anything from which it can be inferred that a conscious decision was taken to dispense with the application of Section 5A which represents two facets of the rule of hearing that is the right of the land owner to file objection against the proposed acquisition of land and of being heard in the inquiry required to be conducted by the Collector. There is no such duty caused on SEBI under the Regulations, which would make it incumbent upon it to grant a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with the power to exercise discretion in connection with statutory appeals, it shall lead to chaotic conditions. Many statutory appeals and applications are disposed of by the competent authorities who have been vested with powers to dispose of the same. Such authorities which shall be deemed to be quasi-judicial authorities are expected to apply their judicial mind over the grievances made by the appellants or applicants concerned, but it cannot be held that before dismissing such appeals or applications in all events the quasi-judicial authorities must hear the appellants or the applicants, as the case may be. When principles of natural justice require an opportunity to be heard before an adverse order is passed on any appeal or application, it does not in all circumstances mean a personal hearing. The requirement is complied with by affording an opportunity to the person concerned to present his case before such quasi-judicial authority who is expected to apply his judicial mind to the issues involved. Of course, if in his own discretion if he requires the appellant or the applicant to be heard because of special facts and circumstances of the case, then certainly it is always ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the appellants seeking to withdraw the public announcement. Each and every circumstance mentioned was considered by SEBI. Therefore, it can not be said that the appellants have been in any manner prejudiced by the non-grant of the opportunity of personal hearing. Therefore, the submission made by Mr. Shyam Divan with regard to the breach of rules of natural justice is rejected. 33. Mr. Shyam Divan then submitted that the interpretation placed on Regulation 27(1) (d) by SEBI as well as the SAT results in restriction on the wide powers given to SEBI to regulate the securities market to further the object of the SEBI Act. He submits that the appellants are equally "an investor" in the market; therefore, the regulator also has to keep the interest of the appellants in mind. He makes a reference to Regulation 3(1) (f) which provides that nothing contained in Regulations 10, 11 and 12 shall apply to acquisition of shares in the ordinary course of business by banks and financial institutions as pledgees. This, according to Mr. Shyam Divan, is an indicator that, for a certain class of institutional investor there is a carve out. He submits that similar carve out is also provided for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the rule of ejusdem generis applies only if the statutory provision - (i) contains an enumeration of specific words; (ii) the subjects of enumeration constitute a class or category; (iii) that class of category is not exhausted by the enumeration; (iv) the general terms follow the enumeration; and (v) there is no indication of a different legislative intent. 37. Learned senior counsel submits that in the present case none of the said requirements are met. The rule of ejusdem generis is restricted to cases where the specific words precede the general words in the language of the statute, and in totality from a singular genus along with the general words. The sub-clauses of Regulation 27 do not form a common genus of cases where it is impossible to do an open offer. Learned senior counsel submitted that the provisions contained in the Takeover Code are regulatory in nature and, therefore, have to be construed widely. The Takeover Code provisions do not apply to pledgees. The text of the Takeover Code indicates a different legislative intent so far as the pledgees are concerned. He submits that the court is entitled to look at the legislative history for interpretation of any provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mit withdrawal only on the same footing as the circumstances enumerated under Regulation 27(1)(b) and (c). This would leave no discretion with SEBI to approve withdrawal, "in such circumstances", which in the opinion of the Board "merit withdrawal." Finally, it is submitted that it is an accepted principle that where two interpretations are possible then such an interpretation ought to be taken which will not render any provision of a statute otiose. According to him, Regulation 27(1) (d) would be rendered meaningless if it is read ejusdem generis with Regulation 27(1) (b) and Regulation 27(1) (c). Learned senior counsel also relied on Regulation 3 of Takeover Regulations which empowers the respondent to grant a complete exemption to an acquirer from Regulations 10, 11 and 12 in certain cases. He submits that residuary power under Regulation 3(1) in addition to the specific scenario mentioned therein is strongly indicative of the intention of the legislature. In the facts of the present case, it is submitted by Mr. Shyam Divan that had the appellants realized that there was a fraud before making public announcement, it could have gone to the Takeover Panel after it exercised the pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the stock exchanges where shares of the target company are listed. Under Regulation (8), such an acquirer shall within 21 days from the financial year ending March 31, make yearly disclosures to the company, in respect of his holdings as on 31st March. Regulation 8A provides for disclosure of information with regard to pledged shares. The Board has power under Regulation 9, to call for information with regard to the disclosures made under Regulations 6, 7, and 8 as and when required by the Board. Regulation 10 mandates that no acquirer shall acquire shares or voting rights which entitle such acquirer to exercise 15% or more of the voting rights in a company, unless such acquirer makes a public announcement to acquire shares of such company in accordance with the Regulations. The Takeover Code then prescribed a detailed procedure for making a public announcement and the manner in which the offer price is determined at which the shares are offered to public shareholders. Regulation 11 provides that no acquirer who, together with persons acting in concert with him, has acquired, in accordance with the provisions of law, 15% or more but less than 55% of the shares or voting rights in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of offer issued in relation to the acquisition of shares must not contain any misleading information. Under Regulation 18, within 14 days from the date of public announcement made under Regulations 10, 11 or 12, as the case may be, the acquirer, through its Merchant Banker, is mandated to file with SEBI the draft of the letter of offer, containing disclosures as specified by the Board. This letter of offer is to be dispatched to the shareholders not earlier than 21 days from its submission to the Board. However, the Board has the power to specify changes, if any, in the letter of offer which the merchant banker and the acquirer is required to carry out such changes before the letter of offer is dispatched to the shareholders. Regulation 20 provides that the offer to acquire share under Regulations 10, 11 or 12 shall be made at a price not lower than the price determined as per sub-regulations (4) and (5).Sub-Regulations (4) and (5) provides a complete procedure for determination of the price. Under Regulation 21, it is provided that the public offer made by the acquirer to the shareholders of the target company shall be for a minimum 20% of the voting capital of the company. Regu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not take place in a clandestine manner without protecting the interest of the shareholders. It is keeping in view the aforesaid aims and objects of the takeover code that we shall have to interpret Regulations 27(1). Regulation 27 reads as under: "Withdrawal of offer - (1) No public offer, once made, shall be withdrawn except under the following circumstances:- (a)** ** ** (b) the statutory approval(s) required have been refused; (c) the sole acquirer, being a natural person, has died; (d) such circumstances as in the opinion o the Board merits withdrawal. (2) In the event of withdrawal of the offer under any of the circumstances specified under sub-regulation (1), the acquirer or the merchant banker shall: (a) make a public announcement in the same newspapers in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as those listed." 44. The meaning of the expression ejusdem generis was considered by this Court on a number of occasions and has been reiterated in Maharashtra University of Health Sciences and Ors. v. Satchikitsa Prasarak Mandal & Ors. [2010] 3 SCC 786. The principle is defined thus : "The Latin expression "ejusdem generis" which means "of the same kind or nature" is a principle of construction, meaning thereby when general words in a statutory text are flanked by restricted words, the meaning of the general words are taken to be restricted by implication with the meaning of the restricted words. This is a principle which arises "from the linguistic implication by which words having literally a wide meaning (when taken in isolation) are treated as reduced in scope by the verbal context". It may be regarded as an instance of ellipsis, or reliance on implication. This principle is presumed to apply unless there is some contrary indication [see Glanville Williams, The Origins and Logical Implications of the Ejusdem Generis Rule, 7 Conv (NS) 119]." 45. Earlier also a Constitution Bench of this Court in Kavalappara Kottarathil Kochuni v. State of Madras A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Divan that clause (d) would permit SEBI to accept the offer of withdrawal even in circumstances when it has become uneconomical for the acquirer to perform the public offer. The rule of ejusdem generis as defined by this Court in Commissioner of Income Tax, Udaipur, Rajasthan v. McDowell and Co. Ltd. [2009] 10 SCC 755 is as follows : "The principle of statutory interpretation is well known and well settled that when particular words pertaining to a class, category or genus are followed by general words, the general words are construed as limited to things of the same kind as those specified. This rule is known as the rule of ejusdem generis. It applies when: (1) the statute contains an enumeration of specific words; (2) the subjects of enumeration constitute a class or category; (3) that class or category is not exhausted by the enumeration; (4) the general terms follow the enumeration; and (5) here is no indication of a different legislative intent." 49. Mr. Divan has sought to persuade us that clause (d) in fact carves out an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r development of the securities market. Mr. Venugopal is correct in voicing the apprehension that if on ground of fall in prices, public offer is allowed to be withdrawn, it could lead to frivolous offers, being made and withdrawn. This would adversely affect the interests of the shareholders of the target company and the integrity of the securities market, which is wholly contrary to the intent and purpose of the takeover regulations. In such circumstances, we are unable to agree with the submission of Mr. Shyam Divan that the order passed by SEBI on 30th April, 2007 can be said to be an order causing civil consequences. The appellants wanting to withdraw the public offer merely wishes to cut its losses at the expense of the innocent shareholders, who are entitled under the Regulations to the exit option. In such circumstances, the appellants would have to buy the shares at the quoted prices of Rs.18.60 per share, placing a financial burden on the appellants. The aim of the appellants was merely to avoid such an added burden. This is patent from the plea made by the Merchant Bankers on 22nd September, 2006 on behalf of the appellants. In the aforesaid application, it is clearly me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pledged in course of the business, since the object of such private companies is also not to takeover the management but to secure their loan. It is also submitted that Regulation 27(1) (d) of the Takeover Code ought to be interpreted with such latitude to further the said objective of the Takeover Code. 53. We are unable to accept the aforesaid submission of Mr. Shyam Divan. Rather we find merit in the submission of Mr. Venugopal that Regulation 3(1) (f) (iv) (which exempts the acquisition of shares by banks and public financial institutions as pledgees, from the provisions of the Takeover Regulations), does not advance the case of the appellants any further. Under this regulation, exemption is provided to certain entities that acquire shares in the ordinary course of business. The regulation provides exemption from Regulation 10, 11 and 12 to Scheduled Commercial Banks or Public Financial Institutions acting as pledgees in the ordinary course of business, in order to facilitate their business operations. Such acquisition of shares in normal circumstances is not with the intention of taking over the target company. The shares are acquired to protect the economic interest of the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chandra v. Savitri Devi [2003] 8 SCC 319 (Paras 15-30). 58. This submission of Mr. Shyam Divan is wholly misconceived in the facts and circumstances of this case. In the case of Ram Chandra (supra), this Court has reiterated the principle laid down in the case of S.P. Chengalvaraya Naidu (dead) by LRs. v. Jagannath (Dead) by LRs. and Ors. [1994] 1 SCC 1. The principle was explained by Kuldip Singh, J. in the following words: "Fraud avoids all judicial acts, ecclesiastical or temporal" observed Chief Justice Edward Coke of England about three centuries ago. It is the settled proposition of law that a judgment or decree obtained by playing fraud on the court is a nullity and non est in the eyes of law. Such a judgment/decree - by the first court or by the highest court - has to be treated as a nullity by every court, whether superior or inferior. It can be challenged in any court even in collateral proceedings." 59. It was further held in paragraph 5, as follows:- "5. The High Court, in our view, fell into patent error. The short question before the High Court was whether in the facts and circumstances of this case, Jagannath obt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was made public, the market price of the shares of the target company fell from Rs.18.60 to Rs.8.56. He also emphasised that the Sharma Report also brought to public notice the Kalyaniwala Report and Sharp Report. These reports were submitted to the erstwhile Board of Directors of the target company in 2002. However, these reports were not made public and in fact were deliberately withheld from the public in spite of the same being price sensitive. Therefore, according to Mr. Shyam Divan, the appellants, or for that matter, any person exercising due diligence and care, could not have and did not know the existence and nature of the fraud and embezzlements by the erstwhile promoters of the target company. If the SEBI, the capital market regulator, with all its infrastructure did not become aware of the damning indictment of a listed company permitting its controlling promoters to abuse, misuse and embezzle funds belonging to investors in the securities market, it cannot rationally be accepted that the appellants would have discovered the same by exercise of due diligence. Mr. Shyam Divan further brought to our notice the facts which were known at the time of public announcement and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion recorded by the SEBI which has been upheld and approved by SAT is without any factual basis. 64. Mr. Shyam Divan, relying on Regulation 3A which prohibits dealing in securities of a target company if a person has access to price sensitive information, submitted that if the appellants were privy to the contents of the Kalyaniwala and Sharp Reports it would have been precluded from invoking the pledges, as such action would constitute "dealing in securities". It is also submitted by Mr. Shyam Divan that the expression "due diligence" does not mean that the party has to assume the role of amateur detective, nor is the party obliged to make any enquiries unless it can be established that there existed any circumstances which should have aroused any suspicion. It is also submitted that the law laid down in Marfani and Co. Ltd. v. Midland Bank Ltd. 1968 (2) All E.R. 573 and Indian Overseas Bank v. Industrial Chain Concern 1990 1 SCC 484 which enumerates the benchmark or standards accepted from a party while performing the due diligence should be taken into account. 65. We are not much impressed by any of the submissions made by Mr. Shyam Divan on this issue. Admittedly, the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investing in this entity would not be a prudent decision. 67. Taking into account the aforesaid state of affairs, SAT has concluded as follows:- "The above facts would seem to be enough to provide the appellants a correct prognosis regarding the financial health and prospects of the target company. Clearly, the appellants decided on invoking the pledge on the shares of the target company with open eyes and sufficient knowledge about the affairs of the target company. It is not as if the appellants were innocent and were caught napping in an unexpected turn of events. We are not, therefore, inclined to accept at its face value the argument of the appellants that they had no prior clue about the adverse financial information relating to the target company and were contained in the later reports of the Chartered Accountants. In this view of the matter, the Board was justified in characterizing the situation that the appellants are faced with as the result of lack of due diligence and/or sheer business misfortune. They are only trying to wriggle out of a bad bargain which is not permissible under Regulation 27(1)(d) of the takeover code." 68. The aforesaid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first time, in the submissions made by Mr. Shyam Divan. In fact, the ground is not even pleaded in the grounds of appeal. The submission is mentioned only in the list of dates. Since, we are considering a statutory appeal under Section 15Z of the SEBI Act, the same cannot be permitted to be raised in this Court for the first time, unless the submission goes to the very root of the matter. This apart, even on merit, we find that the submission is misconceived. Regulation 18(1) and (2) of the SEBI Takeover Code reads thus:- 18. Submission of letter of offer to the Board - (1) Within fourteen days from the date of public announcement made under regulation 10, 11 or 12 as the case may be, the acquirer shall, through its merchant banker, file with the Board, the draft of the letter of offer containing disclosures as specified by the Board. (2) The letter of offer shall be dispatched to the shareholders not earlier than 21 days from its submission to the Board under sub-regulation (1): Provided that if, within 21 days from the date of submission of the letter of offer, the Board specif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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