SECURITIES APPELLATE TRIBUNAL, MUMBAI
R. Shankar
Versus
Securities & Exchange Board of India
Appeal No. 145 of 2012
December 20, 2012
JUDGMENT
P.K. Malhotra, Member & Presiding Officer (Offg.) – This order will dispose of five Appeal nos. 145 to 149 of 2012. We find that a common show cause notice was issued to nine entities and a common order has been passed against all these entities out of which only five are in appeal before us. Counsel for the parties agree that since these appeals arise out of common set of facts, they can be disposed of by a common order and facts can be taken from Appeal no. 145 of 2012. When these appeals were fixed for hearing learned counsel for the appellant has taken a preliminary objection with regard to appeal being heard by this bench in the absence of a regular Presiding Officer. It was stated by him that a Writ Petition No. 5847 of 2012, Sandeep Jain v. Union of India has been filed in the Bombay High Court challenging jurisdiction of the Tribunal to hear appeal in the absence of a regular Presiding Officer. At the request of the learned counsel for the appellant, the appeals were kept pending awaiting outcome of the writ petition.
The Hon’ble High Court, by its order dated November 26, 2012, has dismissed the writ petition holding that there is no impediment in the appeal being heard by the appellate tribunal which presently consists of two members, one of whom is authorized to preside over the sitting of the appellate tribunal.
2. With the consent of counsel for the parties, now we proceed to dispose of these appeals. The appellants in these appeals are aggrieved by the order dated April 26, 2012 passed by the adjudicating officer of the Securities and Exchange Board India (the Board ) against nine entities, including five appellants before us, holding them guilty of violating regulations 7 and 10 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (for short takeover code) and imposing a penalty of Rs. 4 lacs each under section 15 A(b) and 15 H of the Securities and Exchange Board of India Act, 1992 (the Act).
3. The facts of the case, in brief, are that the Board carried out investigation in the matter of Datasoft Application Software (India) Limited (the company) for the period 2000-2001. At the relevant time the scrip of the company was listed on the Bombay Stock Exchange and Ahmedabad Stock Exchange. The Board observed that on January 28, 2000 the company made preferential allotment of 1,20,00,000 shares for cash @ 10/- per share with a premium of Rs. 17/- per share. The share capital of the company was 1,50,00,000 out of which 30,00,000 shares were fully paid up at Rs. 10/-each and rest of 1,20,00,000 shares were partly paid up to the extent of 10%. The total paid-up capital of the company amounted to Rs. 4,20,00,000/-. The details of the preferential allotment to the nine entities, as stated in the impugned order, is as under:
