Close business association between two or more persons does not by itself make them person acting in concert

CASE LAWS DETAILS

DECIDED BY: SECURITIES APPELLATE TRIBUNAL MUMBAI,  

IN THE CASE OF: Triumph International Finance India Ltd. Vs SEBI, Appeal No: Appeal No. 183 of 2009, DECIDED ON: February 9, 2010

RELEVANT PARAGRAPH

6. We have carefully perused the show cause notice which was common to all the six entities including the appellant who were alleged to have acted in concert with each other in the acquisition of the shares of the target company. Apart from making a bald assertion in para S of that notice that all the notices were acting in concert, there is nothing else in the show cause notice to suggest that the appellant was acting in concert with the other notices. As already observed, the notice was issued to Panther Invest Trade Ltd., Classic Share and Stock Brooking Services Ltd., Panther Fin cap & Management Services Ltd., Classic Credit Ltd. and Triumph Securities Ltd. besides the appellant and they all have been found to be companies associated with and controlled by Ketan Parekh. The appellant seriously challenges the finding that it is controlled by Ketan Parekh or by any of his entities. Since none of the notices other than the appellant has come up in appeal, we shall proceed to dispose off this appeal on the basis that the other entities were Ketan Parekh controlled entities. This apart, this Tribunal while disposing off Ketan Parekh’s case (supra) has already upheld the findings that some of the noticees other than the appellant were Ketan Parekh controlled companies. The appellant was not involved in Ketan Parekh’s case nor in any other appeal decided along with that case. A reading of the show cause notice makes it clear that the adjudicating officer is throughout referring to all the notices as close associates of Ketan Parekh. However, in the impugned order he has referred to several facts in para 19 to hold that the appellant was connected/ affiliated to Ketan Parekh atleast from the year 1999 on wards and that its plea that it was not acting in conceit with other notices could not be accepted. Since the shares of the target company had been acquired with a common objective of the Ketan Parekh group, it is necessary to refer to the facts noticed in para 19 of the impugned order and the same reads as under:-

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