Case Law Details
Enchante Jewellery Ltd. Vs BSE Ltd. (SAT Mumbai)
In the instant case, the appellant’s securities was suspended w.e.f. January 07, 2002. The appellant failed to discharge its obligation which it was required to pay the annual listing fee inspite of such suspension. We are of the opinion, that listing of securities and trading of securities are two distinct and well understood terms. The securities of a listed company may continue to be listed on the platform of the Exchange but trading in its securities may be suspended for various reasons. The fact that the trading of the securities of the appellant’s company was suspended does not entitle the appellant not to pay the annual listing fee. Even though, the trading was suspended, the securities of the appellant company continued to be listed on the platform of the Exchange which necessarily entails compliance with listing requirements and consequently payment of annual listing fee. Under the listing agreement the appellant is duty bound to pay the annual listing fee till such time the securities are listed on the platform of the Exchange. Admittedly, various compliances have not been made by the appellant and, consequently, the impugned order was passed.
The contention that since the securities of the appellant continues to remain listed during the suspension period the appellant is, thus, not liable to pay any reinstatement fee to the Exchange is incorrect. In this regard, we find that reinstatement fee is one of the requirements for purpose of revocation of suspension in the trading of securities. This requirement of payment of reinstatement fee is also gathered from the Circular dated December 19, 1994 issued by SEBI and Master Circular of listing dated January 18, 2019 wherein it becomes obligatory for a Company whose securities continue to be listed at the Exchange to pay annual listing fee as well as reinstatement fee for considering revocation of suspension in trading in the securities of the company.
SAT held that SEBI is entitled to levy fee for the purpose of revocation of suspension of trading in securities and the same is binding on companies desirous of such revocation. The Byelaw also empowers the respondent to reinstate suspended securities subject to conditions as it deems fit. Further in Clause 43 of the Listing Agreement the respondent is entitled to levy reinstatement fee upon companies seeking revocation of suspension of trading in securities.
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