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TMI Blog2020 (7) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... in Adjudicating Officer, Securities and Exchange Board of India v. Bhavesh Pabari [ 2019 (3) TMI 197 - SUPREME COURT] . In the instant case, we are of the opinion that the power to adjudicate has not been exercised within a reasonable period and therefore no penalty could be imposed. Without going into the merits of the case, we find that on account of the inordinate delay in the initiation of the proceedings by issuance of a show cause notice, the penalty order cannot be sustained. - Appeal nos. 169, 171, 172, 231 of 2019 And Oths. - - - Dated:- 31-1-2020 - Tarun Agarwala, Presiding Officer And Dr. C.K.G. Nair, Member For the Appellant : Ms. Rinku Valanju, Adv. and Ms. Hiral Shah For the Respondent : Karan Bhosale, Kaushal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls which are being decided together. 3. The ground urged is, that there is an inordinate delay in the issuance of the show cause notice for violation of Section 12(A)(a), (b) and (c) read with Regulations 3(a),(b),(c) (d) and 4(1), (4(2)(a) and (g) of PFUTP Regulations. It was urged that on the ground of inordinate delay the proceedings should have been dropped and no penalty could have been imposed. It was contended that the alleged violations occurred in the year 2010 whereas the show cause notice was issued in the year 2017 after 7 years for which no explanation has been given. 4. In support of his submission the learned counsel for the appellants have relied upon a decision of this Tribunal in Ashok Shivlal Rupani Ors. v. SEBI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice in the additional affidavit contending that on the basis of the investigation which started in September/October 2011 a preliminary report was prepared on April 2, 2012 but no action could be taken in 2013-14 as there were certain changes in the officers of the Investigation department. The investigation report was subsequently approved in February 2016 based on which a show cause notice was issued on July 24, 2017. 8. In our opinion, the grounds shown by the respondent in its additional affidavit only indicates the lackadaisical attitude in proceeding against the entities. It is quite clear that no urgency was shown by the respondent to culminate the proceedings and has moved at a leisurely pace. We find that after the submission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the matter of Subhkam Securities (P.) Ltd. versus Securities and Exchange Board of India (Appeal No. 73 of 2012) observed as follows, There is yet another aspect of the case which we would like to highlight here. The trades for which investigation was carried out pertain to the year 2000 and the impugned order has been passed only in March, 2012. Investigation started in or around June, 2001. It has taken the Board twelve years to complete the proceedings in a matter relating to market manipulation. This is not the way to conduct proceedings against entities who are charged with serious allegations like market manipulation or insider trading. Expeditious disposal of such proceedings by the Board alone will ensure that the Board is carry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant case has not been done and in fact it has totally ignored such objection. We are further of the opinion that when the matter is being decided against the appellants as a group by a common order, an objection raised by one appellants will cover for all the appellants and it will not be confined to that appellant alone especially when the objection raised is one of mixed question of law which goes to the root of the matter. 12. Having considered the matter we are of the view that there has been an inordinate delay on the part of the respondent in initiating proceedings against the appellants for the alleged violations. The controversy in this regard is squarely covered by a decision of this Tribunal in Mr. Rakesh Kathotia Ors. v. SEB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her the third-party rights had been created etc. 13. Similar view was again relied in Ashok Shivlal Rupani Ors. v. SEBI (Appeal No. 417 of 2018 along with other connected appeals decided on August 22, 2019) and again in Sanjay Jethalal Soni Ors. v. SEBI in Appeal No. 102 of 2019 and other connected appeals decided on November 14 2019. 14. We also find that in the case of Ashok Shivlal Rupani (supra) the period of investigation was January 4, 2010 to January 10, 2011 in the scrip of M/s. Oregon Commercial Ltd. and the show cause notice issued on November 20, 2017 which this Tribunal held that there was an inordinate delay. In the instant case, the same scrip was investigated for the same period and there is a delay of 7 years in i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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