9911796707
TMI Blog2014 (1) TMI 1658X X X X Extracts X X X X X X X X Extracts X X X X ..... that the respondent conducted investigation into certain dealings in the scrip of M/s. Axon InfoTech Ltd. (AIL/Target Company) for the period between March 17, 2006 to September 19, 2006. During the investigation it was revealed that some eight entities acting in concert with each other had acquired 32.02% shares/voting rights of the Target Company on April 5, 2006 without making a public announcement as required in terms of regulation 10 of the Takeover Regulations, 1997. Said eight entities are as under: (i) Mr. Giriraj Kishore Agarwal (hereinafter referred to as 'GKA'), (ii) M/s. Kushal Software Ltd (KSL), (Presently M/s. Octant Industries Ltd.) (iii) M/s. Kushagra Software Ltd. (Kushagra), (Presently M/s. Concurrent (India) Infrastructure Ltd.), (iv) M/s. Shreeji Herbal Ltd. (SHL) (Presently M/s. Golden Steel Industries Pvt. Ltd.), (v) M/s. Handful Investrade Pvt. Ltd. (HPL), (vi) Ms. Sheetal Kadam (SK), (vii) M/s. VRP Financial Services Pvt. Ltd. (VRP Financial) and (viii) M/s. Keystone Stone Finance Pvt. Ltd. 3. The alleged violation by the above said eight entities was that they crossed the threshold limit of 15% on April 5, 2006 in acquiring shareholding/voting ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uisition of shares in question which taken together would constitute 33.02%, but not individually. 6. On the other hand, Shri. Shyam Mehta, learned senior counsel for the respondent with Shri. Mihir Mody, submits that there is sufficient material on record annexed with the appeal itself which goes a long way to prove that the appellants had acted in concert with each other in acquiring the shares in question with a common objective. In this connection Shri. Shyam Mehta has drawn our attention towards specific findings contained in various paragraphs of the impugned order which establish a relationship among the eight entities, including the three appellants, to bring them under the provisions of section 2(i)(e) read with regulation 10 of the Takeover Regulations, 1997. 7. We have heard both the learned counsel for the parties at length and have minutely perused the pleadings and judgments relied upon by the parties in support of their respective case. An admitted position emerges that during the investigation period between March-September 2006, the share capital of the Target Company was Rs. 1,00,000,00 (Rupees one crore) divided into ten lac equity shares of Rs. 10 each. Howeve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the following manner:- i) During the period of investigation, it was observed that the telephone number 022-26354911 of AIL is registered under the name Handful Investrade Pvt. Ltd. Address of Handful Investrade Pvt. Ltd. was that of AIL. ii) The telephone number of KSL 022-2674065 was registered under the name GKA i. e. Mr. Giriraj Kishore Agrawal from the same address as that of KSL. iii) Dhiren Shukla acted as an interim compliance officer for AIL. GKA, the promoter director of Kushagra Software Ltd., Shreeji Herbal Ltd, Handful Investrade, acted as authorized investment adviser for KSL. iv) From the balance sheet of KSL for the year 2006-07, it was observed that unquoted investments were made by the AIL in Shreeji Herbal Pvt. Ltd. and Handful Investrade Pvt. Ltd. which were promoted by the GKA. v) From the above, it is cleared that AIL and KSL were related to Mr. Dhiren Shukla, promoter and director of AIL acted as director of KSL as observed from the annual reports of KSL from the year 2004-05 and 2005-06. vii) It is also cleared from the details above and information available on record that Mr. Dhiren Shukla Mr. Ravindra Bhaskar Deshmukh, GKA , Mr. Pradeep Dhanuka, M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Signed on behalf of KSL in the capacity of whole time director on KYC form of KSL at Pilot Credit Capital Ltd. Further, Mr. Raj Kishor Agarwal, director of KSL, shares the address of Handful Investrade P. Ltd. along with Mr. Giriraj Kishor Agarwal as per the KYC form with Pilot Credit Capital Ltd., submitted on behalf of KSL. d. Mr. Pradeep Dhanuka has been a Director of AIL and a Director of VRP Financial Services Pvt. Ltd., of whom KSL was a client as stated by VRP Financial Services Pvt. Ltd. e. As far as M/s 5X Investment is concerned it is promoted by Tanu Agarwal, wife of Mr. Giriraj Kishor Agarwal. It has the same address as that of AIL at Unit No. 26, Meera CHS, Link Road Extn, Andheri (W), Mumbai- 400 053 and the same telephone number as that of AIL i.e., 26354910. f. Kushagra Software Ltd. is also promoted by Mr. Giriraj Kishor Agarwal and he was a major shareholder of AIL as on 30.06.06. g. Shreeji Herbals Ltd. is promoted by Mr. Giriraj Kishor Agarwal and was a major shareholder of AIL as on 30.06.06. KSL had investments upto Rs. 1,53,98,300 in Shreeji Herbals Ltd., an unlisted company. h. As far as Handful Investrade P Ltd. is concerned, it is promoted by Mr. G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons, 1997. There is no legal infirmity attached to the impugned order and the same is hereby upheld. 12. Learned counsel for the appellant has relied upon a judgment of this Tribunal dated February 9, 2010 passed in Appeal No. 183 of 2009 in the case of Triumph International Finance India Ltd. vs SEBI. In that case the Tribunal was primarily concerned with the issue of the appellant company being a PAC with Ketan Parekh and whether or not the company was controlled by him. The Tribunal after analyzing the impugned order and facts in that case, held that before a charge of acting in concert is levied, it has to be alleged that the delinquent had a common objective pursuant to an agreement or understanding, formal or informal, with another person for substantial acquisition of shares of the target company. The Tribunal found that this element was missing in that case. The Tribunal, thus, held that merely because the appellant acted as a broker of some of the companies owned or controlled by Ketan Parekh does not make it a 'person acting in concert' with those companies. This could, at the most, mean association with those companies. Close business association between two or more per ..... X X X X Extracts X X X X X X X X Extracts X X X X
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