9911796707
TMI Blog2017 (5) TMI 662X X X X Extracts X X X X X X X X Extracts X X X X ..... conferred under Section 15I(2) of SEBI Act read with Rule 5 of the Adjudication Rules has imposed following penalties on the appellant on account of following violations : 1. Rs. 2,50,000/- under Section 15A(b) of SEBI Act for violation of Regulation 7(1) of SAST Regulations, 1997 read with Regulation 35 of SAST Regulations, 2011. 2. Rs. 2,00,000/- under Section 15A(a) of SEBI Act for violation of Section 11C(3) of SEBI Act, 1992. 3. Rs. 2,00,000/- under Section 15A(a) of SEBI Act for violation of Section 11C(5) of SEBI Act, 1992. 2. At the outset, a decision of this Tribunal dated July 14, 2016 in Appeal No. 22 of 2016 (Concord Realty Pvt. Ltd. vs. SEBI) has been brought to our notice. Under somewhat similar circumstances, it has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant provisions herein below for the sake of convenience :- "Violation of provisions of regulations 7(1) and 7(1A) read with regulation 7(2) of SAST Regulations, 1997 and regulation 13(1) of PIT Regulations, 1992 SAST Regulations, 1997 "Acquisition of 5 per cent and more shares or voting rights of a company "7(1) Any acquirer, who acquires shares or voting rights which (taken together with shares or voting rights, if any, held by him) would entitle him to more than five per cent or ten per cent or fourteen per cent or fifty four per cent or seventy four per cent shares or voting rights in a company, in any manner whatsoever, shall disclose at every stage the aggregate of his shareholding or voting rights in that company to the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eipt of intimation of allotment of shares; or (b) the acquisition of shares or voting rights, as the case may be." 5. The case of the appellant is that the question of deemed PAC cannot be decided in isolation only based on commonality of address to bring home the charge of violation of SAST or PIT Regulations in question against the appellant as has been done by the learned AO in the impugned order. 6. Per contra, the case of SEBI as submitted by Shri Chitale, learned counsel is that as on December 31, 2009, Mahan Industries Ltd. (MIL) had issued capital of 71,50,000 shares of Rs. 10/- each and on January 4, 2010 MIL made a preferential allotment of convertible equity warrants for Rs. 30 crore. On January 15, 2010, MIL split its one s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "Gazala" and "Narois" respectively) were allotted 1,72,50,000 shares and 1,66,75,000 shares of MIL respectively. The shareholding of Gazala and Narois constituted 5.39% and 5.21% respectively of the share capital of MIL at the relevant time. Investigation further revealed that Shri Mitesh Chandrakant Shah and Shri Sagar Dinesh Patel were the common directors of the appellant, Gazala and Narois. Further, Narois and appellant shared a common address and, thus, they were persons acting in concert in acquisition of shares of MIL on February 20, 2010. It was further observed that since the acquisition of shares by the appellant, Gazala and Narois on February 20, 2010 entitled them individually as well as collectively to more than the threshold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er makes it clear that the learned AO has not brought out any convincing and cogent evidence to support the finding that the noticee i.e. appellant acted as a PAC with Narois within the meaning of Regulation 2(e)(2)(i) of SAST Regulations, 1997. It is noted that in paragraph 24 of the impugned order, learned AO has held that on February 20, 2010, the acquisition date, the appellant and Narois were under the same management as per sub-section (1B) of Section 370 of the Companies Act, 1956 and that Shri Karan Kapoor and Shri Ravindra Balekar, who were founders of the appellant company and Narois, by virtue of their common shareholding of 50% each in both these companies, were controlling both these companies on the date of acquisition i.e. Fe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . PAC for holding the appellant liable for violation of Section 7(1) of the SAST Regulations, 1997 read with Regulation 35 of SAST Regulations, 2011. 12. In this view of the matter, penalty of Rs. 2,50,000/- imposed on appellant is set aside and restored to the file of learned AO for hearing this aspect afresh and deciding it as per law after giving an opportunity of hearing to the appellant in respect of the allegation under the SAST Regulations, 1997 read with those of 2011. Accordingly, the impugned order is upheld to the extent of imposition of two penalties of Rs. 2,00,000/- each for violation of Sections 11C(3) and (5) of the SEBI Act, 1992 whereas the penalty of Rs. 2,50,000/- under SAST Regulations, 1997 is set aside and the matter ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
