sebi:Order/KS/VC/2019-20/3484
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Facts / Headnote
Consolidated penalty imposed on remand; SCN dated September 08, 2014 disposed off
Provisions invoked
- s. 15A
- s. 15
- s. 15J
- s. 15F
- s. 28A
Regulations
- Reg. 13(3)
- Reg. 13(5)
- Reg. 29(2)
- Reg. 29(3)
- Reg. 30(2)
- Reg. 30(3)
Holding
On remand from SAT, the Adjudicating Officer imposed a consolidated penalty of Rs. 9,00,000 under Section 15A(b) of the SEBI Act for failure to make disclosures under Regulations 13(3) & 13(4A) read with 13(5) of PIT Regulations and Regulations 29(2) read with 29(3) and 30(2) read with 30(3) of SAST Regulations, disposing off the SCN dated September 08, 2014.
Full text
Page 2 of 6 Adjudicating Officer in the said matter. By the said AO order, the Noticee was held liable for the violation of Regulations 13(3) & 13(4A) read with Regulation 13(5) of PIT Regulations and Regulation 29(2) read with Regulation 29(3) of SAST Regulations and also Regulation 30(2) read with Regulation 30(3) of SAST Regulations. Further, in light of Supreme Court Judgment in the matter of SEBI vs Roofit Industries Ltd. [(2016) 12 SCC 125], the erstwhile AO imposed a penalty of Rs. 4,00,00,000/- (Rs. 4 crore only) on the Noticee.
Page 3 of 6 3. In light of this, vide order dated June 14, 2019, the undersigned was appointed as the Adjudicating Officer by SEBI in the matter for the first time only for the purpose of re-deciding the quantum of penalty. Accordingly, the Noticee was provided with an opportunity of personal hearing on June 25, 2019 at 11.00 AM. The said hearing was postponed to 04.30 PM on the same day upon receiving a request of postponement from the Noticee. Mr. Kunal Katariya, Advocate; Mr. Vipul Shah and Mr. Parth Dave appeared on behalf of the Noticee in the hearing and inter-alia made the following submissions: a. The Company carried no business since 1996 and I have not been associated with the Company since 1997; b. The trading in the company was suspended from 1997 to 2012 and the Company’s shares had lost all its value; c. The Appellant / Noticee has submitted and still maintains that he never sold the shares. In fact, the SCN or the Order contains no finding that the Appellant has ever received any consideration for the alleged sale of shares; d. The investment in the Company has already been reduced to no value and the Appellant has already suffered regarding its investment in the shares of the Company.
Page 4 of 6 Factors to be taken into account by the adjudicating officer. 15J. While adjudging quantum of penalty under section 15-I, the adjudicating officer shall have due regard to the following factors, namely:- a) the amount of disproportionate gain or unfair advantage wherever quantifiable, made as a result of the default; b) the amount of loss caused to an investor or group of investors as a result of the default; c) the repetitive nature of the default. Explanation: For removal of doubts, it is clarified that the power of an adjudicating officer to adjudge the quantum of penalty under Sections 15A to 15E, Clauses (b) and (c) of Section 15F, 15G, 15H and 15HA shall be and shall always be deemed to have been exercised under the provisions of this section.
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Source: SecMarx — sebi:Order/KS/VC/2019-20/3484. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.