Alchemist Infra Realty Limited vs Sebi

Date of decision : 15/06/2015

Misc. Application No.200 of 2015 And Appeal No.298 of 2015

Alchemist Infra Realty Limited 723, DLF Tower "A", Jasola District Centre, New Delhi - 110 044. ... Appellant

Versus

Securities and Exchange Board of India SEBI Bhavan, Plot No.C-4A, "G" Block, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051. ... Respondent

Mr. V.S. Nankani, Senior Advocate a/w Mr. I.J. Nankani, Mr. Rishad Madora, Ms. Sonia Dube, Mr. Shatadru Chakraborty and Mr. H.S. Khokhawala, Advocates i/b. Nankani & Associates for the Appellant.

Mr. Shyam Mehta, Senior Advocate a/w Mr. Rushin Kapadia, Advocate i/b K.Ashar & Co. for the Respondent.

CORAM : Justice J.P. Devadhar, Presiding Officer Jog Singh, Member

Per : Justice J.P. Devadhar (Oral)

1.

Appellant is aggrieved by order passed by the Whole Time Member

(WTM) of Securities and Exchange Board of India ("SEBI" for short) on

27th May, 2015. By that order, application made by Appellant seeking

extension of 24 months for making refund to the investors in compliance with

the order passed by WTM of SEBI on 21st June, 2013 has been rejected. By

order dated 21st June, 2013, WTM of SEBI had directed the Appellant to wind -2-

up the scheme identified as CIS and refund the monies collected from the

investors within a period of three months.

2. Challenging the aforesaid order, Appellant had filed an appeal before

this Tribunal. While dismissing the said appeal and upholding the order of

SEBI, this Tribunal on 23rd July, 2013 had extended the time to comply with

the order of SEBI by 18 months and directed the Appellant to submit a report

to SEBI every six months giving details of the progress made in relation to

amounts refunded to the investors. Liberty was also given to Appellant to

approach SEBI seeking extension of time in case the need arises.

3. Based on the bank certificates dated 21/2/2014, 12/9/2014 and 17/3/2015,

Appellant claims to have refunded Rs.1127,05,80,926 out of the total amount

of Rs.1916,39,43,857 refundable to the investors. Thus, leaving balance

amount of Rs.789,33,62,931 refundable to the investors as on 31/3/2015.

4. The Appellant had filed an application before SEBI on 22/1/2015

seeking extension of time to refund the balance amount. That application is

rejected by the impugned order mainly on the ground that despite letter

dated 9/12/2014 and reminder letter dated 20/3/2015 the Appellant has failed

to furnish registration number and address of the investors to whom the

payments were made. Since requisite particulars were not furnished, it is held

that the claim made by the Appellant regarding refund could not be verified

and hence the application seeking extension of time has been rejected.

5. Admittedly, the requisite particulars called for have not been

furnished till date. Without verifying the claim made by the Appellant, the

WTM of SEBI could not have granted extension of time. Failure on part of the -3-

Appellant to comply with the direction of WTM of SEBI without any reason

is highly unjustified. However, looking to the fact that the Appellant claims

to have paid Rs.1127,05,80,926 to the investors by relying on bank statements

and Counsel for Appellant states that requisite particulars would be

furnished within a period of two weeks from today, in the interest of justice,

we set aside the impugned order dated 27/5/2015 subject to payment of cost

of Rs.1 lac to be paid by Appellant to SEBI within a period of one week from

today. Appellant is further directed to furnish the particulars demanded by

SEBI vide letters dated 9/12/2014 and 20/3/2015 as also the particulars set out

in para 13 of the impugned order within a period of two weeks from today.

If the requisite particulars are furnished within the time stipulated herein,

then the WTM of SEBI shall verify the same and pass appropriate order on

the application filed by the Appellant in accordance with law, after giving an

opportunity of hearing to the Appellant. If the Appellant fails to furnish

requisite particulars within the time stipulated herein, the order passed on

27/5/2015 shall stand revived.

6. Appeal as well as the Misc. Application are disposed of in the above

terms.

Sd/-

Justice J.P. Devadhar Presiding Officer

Sd/-

Jog Singh Member 15/06/2015 prepared & compared by-ddg