9911796707
TMI Blog2024 (12) TMI 1464X X X X Extracts X X X X X X X X Extracts X X X X ..... ere has been a long history of dispute of the appellant with the SEBI with regard to the definition of 'annual turnover' for calculating the annual fee. The appellant's stand that price of the securities dealt with would not form part of concerned broker's 'annual turnover', was not acceded to by the SEBI in its order dated November 28, 2003, by which the appellant was asked to pay an amount of Rs. 33,51,45,620/- towards the outstanding dues of annual turnover fee and further an amount of Rs. 3,78,29,623/- towards interest. iii. The appellant filed appeal before this Tribunal, which was allowed. That order was challenged by the respondent SEBI before the Hon'ble Supreme Court of India. The Hon'ble Supreme Court on November 24, 2015 set aside this Tribunal's order and following the amendment made in the Stock Brokers Regulations Stock Brokers Regulations - SEBI (Stockbrokers) Regulations, 1992 by which Clause 1(bb) in Schedule III was inserted, based on the report of Bhatt Committee (1999), the appellant was directed to pay fee at 0.001% of the 'annual turnover'. In holding so, the Hon'ble Supreme Court followed its earlier decision in the case of B.S.E. Brokers Forum Bombay & Ors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bove order of SAT, by which it was acknowledged that the appellant had settled the outstanding turnover fee of Rs. 7,06,38,211/-. It was however, informed that balance amount of fee of Rs. 666/- and interest at the rate of 15% p.a. (simple) of Rs. 9,79,28,344/- was still outstanding. The appellant was asked to make payment within 15 days. vii. This appeal is against the said order of the SEBI. 3. The appeal is filed on the following grounds :- i. The impugned order is a non-speaking order which does not deal with the detailed submissions made by the appellant vide letter dated November 13, 2019 pertaining to waiver of interest. ii. Since this Tribunal had allowed the appeal in 2006 in favour of the appellant against which the respondent preferred an appeal before the Hon'ble Supreme Court, the appellant was not in a position to calculate the registration fee pending the long and chequered litigation. iii. The respondent SEBI has misinterpreted the decision of this Tribunal dated September 19, 2019, by which, with regard to charging of simple interest it was held that,- 'after adjusting the deposits / payments already made by the appellant, if any outstanding amount of prin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atraman, learned advocate for the appellant and Mr. Pradeep Sancheti, learned senior advocate for the SEBI made detailed submissions. 5. Assailing appellant's plea, the learned senior advocate Mr. Sancheti for the SEBI submitted as under :- 5.1 In pursuance of the Hon'ble Supreme Court's order dated November 24, 2015, this Tribunal vide order dated September 19, 2019 decided various issues, inter-alia, rejecting the claim of the appellant on fee continuity benefit. It was held that the appellant was liable to pay registration fees based on its turnover, for a period of 5 years commencing from October 20, 2000 i.e., (when a fresh registration was granted in the name of Garban Intercapital IL Ltd.) Further, it was held that fees were to be re-calculated at the rate of 0.001% for a period of 5 years from October 20, 2000 and that after adjusting the deposits/payments already made by the appellant, if any outstanding amount of principal was found to be due from the appellant, SEBI would be at liberty to impose simple interest on such outstanding payment at the rate of 15% p.a. Accordingly, SEBI recomputed the fee liability of the appellant and issued a letter dated May 18, 2022, adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o charge interest from the date of cause of action till the date of commencement of proceedings for recovery. Further, reliance was placed on the decisions of this Tribunal in the cases of Somani Overseas Pvt. Ltd. & Ors. vs. SEBI (Appeal No. 431 of 2019 decided on December 21, 2021) and PVP Global Ventures Pvt. Ltd. vs. SEBI (Appeal No. 451 of 2018 decided on April 12, 2019) in which the decision in the case of Dushyant Dalal (supra) has been followed. 5.2 Mr. Sancheti argued that interest liability would continue to accrue during the period when interim stay granted by this Tribunal in Appeal No. 56 of 2004 on December 6, 2004, remained in operation till August 2006, when the final order was passed by this Tribunal. In this regard, our attention was drawn to the decision of the Hon'ble Delhi High Court in the case of Delhi Development Authority vs. Sardar Singh & Sons [(2009) ILR 4 Delhi 485]. 5.3 With regard to the appellant's plea that the amount of fee payable was not crystalized till the date of the passing of the order by this Tribunal i.e. September 19, 2019, when the such fee got crystalized, it was argued that the appellant in the first place was required to make asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ebruary 20, 2002 with insertion of a new Clause 1(bb)(ii) in the Schedule III, whereby the stock brokers in WDM segment were required to pay 0.001% of turnover as annual fee. 7.1 In view of this, we find that the appellant was already required to pay a fee in terms of the circular dated January 7, 1993, which the amended Stock-Brokers Regulations (February 2002) also provided for. We find that the appellant was aware of the same and, accordingly, had paid an amount of Rs. 2.42 crore on September 6, 2003. However, the appellant preferred to plead with the SEBI for a lowering the basis for the annual turnover based fee, which was not acceded to by the SEBI, and against that order of the SEBI, appellant filed an appeal before this Tribunal. In terms of the interim order of stay granted by this Tribunal, the appellant paid a further amount of Rs. 50 lakh on January 14, 2005. That appeal was allowed by this Tribunal in favour of the appellant on December 6, 2006. However, eventually, the Hon'ble Supreme Court vide the order dated November 24, 2015 set aside the order passed by this Tribunal and following the earlier decision in the case of BSE Broker Forum (supra), decided the annual f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ember 6, 2003 and Rs. 50 lakh paid on January 14, 2005), from the date of this Tribunal's order dated December 6, 2006 till the order of the Hon'ble Supreme Court's order dated November 24, 2015. However, we find that vide the aforesaid order, the Hon'ble Supreme Court has upheld the calculation of 'annual turnover fee' made by the SEBI, which is in accordance with the applicable Stockbrokers Regulations, 2002. In view thereof, interest is rightly charged on the appellant on the outstanding dues of 'annual turnover fee'. There is no merit in the claim of interest thereon, since the appellant has already got the credit for interest on the principal amount of Rs. 2.92 Crore for the entire period from 2006 till 2019, since no interest has been charged thereon. 7.4.1 However, we note that for a brief period of September 6, 2003 till October 1, 2003, the appellant was having a credit balance of Rs. 74,55,793/-. No interest has been credited to the appellant for this period. In our view, appellant is entitled for the credit of 15% interest p. a. (simple) for the period from September 6, 2003 to October 1, 2003 on this amount lying in appellant's credit. The impugned order needs to be mo ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
