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TMI Blog2019 (5) TMI 1172X X X X Extracts X X X X X X X X Extracts X X X X ..... n 15H(ii) of the SEBI Act, 1992 and a penalty of ₹ 2 lakh was imposed for non-disclosure under Section 15A(b) of the SEBI Act, 1992 - appellants suo motu reduced their shareholding as a remedial measure - HELD THAT:- We find that AO of SEBI had found that it could not be ascertained that there was any disproportionate gain or unfair advantage made by the appellants nor could it be ascertained with regard to the loss caused to the investors as a result of the failure on the part of the appellants to make a public announcement within the time required - The allotment of the shares by the target company to the appellants was made in accordance with resolution passed by the shareholders in its annual general meeting. Further there was no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin six weeks from today - Appeal No. 43 of 2018 - - - Dated:- 15-5-2019 - Mr Tarun Agarwala, Presiding Officer And Dr. C.K.G. Nair, Member And M.T. Joshi, Judicial Member For The Appellants : Mr. Somasekhar Sundaresan, Advocate with Mr. Paras Parekh, Ms. Ankita Roy and Mr. Ashish Venugopal, Advocate For The Respondent : Mr. Mustafa Doctor, Senior Advocate i/b Legasis Partners ORDER Per : Justice Tarun Agarwala (Oral) 1. The present appeal has been filed questioning the validity of the order dated December 29, 2017 passed by the Adjudicating Officer ( AO for short) of the Securities and Exchange Board of India ( SEBI for short) imposing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. We have heard Shri Somasekhar Sundaresan, the learned counsel along with Mr. Paras Parekh, Ms. Ankita Roy and Mr. Ashish Venugopal for the appellants and Shri Mustafa Doctor, the learned senior counsel for the respondent. 4. The increase in the shareholding beyond 55% is admitted but what was contended that the appellants suo motu reduced their shareholding as a remedial measure, and, in any case, the appellants were themselves promoters of the target company and therefore this marginal increase of their shareholding beyond 55% did not result in any change in control of the target company nor brought any loss to the investors. It was further contended that the conversion of warrants was through a preferential a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investors as a result of the failure on the part of the appellants to make a public announcement within the time required. We also find that the allotment of the shares by the target company to the appellants was made in accordance with resolution passed by the shareholders in its annual general meeting. Further there was no repetitive nature of the default made by the appellants. We also find that the appellants belong to the promoter group and even though there was a marginal increase in the individual shareholding of the appellants, there was no change in the management or control of the target company due to the increase in the shareholding of the appellants and the promoter s group. Further we find that the appellants after becoming aw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercising the powers of the Board can also exercise powers to make such orders and given such directions as may be necessary or expedient to secure the ends of justice as specified under Rule 21 of the Securities Appellate Tribunal (Procedure) Rules, 2000. These powers have been conferred upon the Tribunal with a view to do complete justice between the parties which is equitable in nature to be exercised to ensure justice between the parties or to prevent miscarriage of justice. 9. Consequently, for the reasons stated aforesaid, the appeal is partly allowed. The impugned order is modified and the penalty is reduced to ₹ 30 lakh which shall be paid by the appellants to the respondent within six weeks from today. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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