Devendra Suresh Gupta vs Sebi

Date of decision: 18/03/2016

Appeal No.117 of 2015

Devendra Suresh Gupta Ramdas Chawl, Room No.1, Chimatpada, Marol Naka, Andheri (E), Mumbai - 400 059. ... Appellant

Versus

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

WITH Misc. Application No.184 of 2015 And Appeal No.267 of 2015

Rajesh Pravinkumar Bhanushali 403, Mihir Co-op Housing Society, Plot No.18, Sector - 6, Airoli, New Mumbai. ... Appellant Versus

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

Dr. S.K. Jain, PCS for Appellants

Mr. Kumar Desai a/w Mr. Tomu Francis for the Respondent. -2-

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

Per : Justice J.P. Devadhar (Oral)

Misc. Application No.184 of 2015 in Appeal No.267 of 2015:

By this Misc. Application, Appellant seeks condonation of 110 days

delay in filing the Appeal. For the reasons stated in the Misc. application,

delay is condoned. Misc. Application is disposed of accordingly.

Appeal No.117 of 2015:

1.

Appellant is aggrieved by the adjudication order passed by the

Adjudicating Officer ("AO" for short) of Securities and Exchange Board of

India ("SEBI" for short) on November 28, 2014 whereby penalty of Rs.5 lac is

imposed upon the Appellant under Section 15HA of the Securities and

Exchange Board of India Act for violating provisions of Securities and

Exchange Board of India (Prevention of Fraudulent and Unfair Trade

Practices Relating to Securities Market) Regulations, 2003 ("PFUTP

Regulations" for short). On perusal of the said order, it is seen that the

appellant is held guilty of violating the PFTUP Regulations, because 31

noticees (including the appellant) set out therein, were connected to each

other and constituted the Pabari-Parikh group and had indulged in the shares

of Gemstone Investment Limited (GIL) in violation of the PFUTP Regulations.

However, in the chart (at page 23 of the appeal memo) set out in the

impugned order, the relationship of the appellant with other noticees are not

set out. However, fact that the appellant had traded in the shares of GIL with

the group entities is not in dispute. In these circumstances, in the absence of

any clear finding in relation to the relationship of the appellant with other

noticees, we set aside the impugned order dated 28/11/2014 qua the -3-

Appellant and restore the matter to the file of AO of SEBI for passing fresh

order on merits and in accordance with law.

Appeal No.267 of 2015:

In view of the grievance of the appellant that he was not served with

the notice of hearing and therefore, the ex-parte order passed against the

appellant ought to be quashed and set aside, Counsel for the parties state that

in the facts of present case, impugned order be quashed and set and aside qua

the Appellant and restored to the file of Adjudicating Officer of SEBI for fresh

decision on merits. Accordingly, the impugned order dated 28/11/2014 is

quashed and set aside qua the Appellant and the matter is restored to the file

of the Adjudicating Officer of SEBI for passing fresh order on merits and in

accordance with law. All contentions of both the parties are kept open.

2. Counsel for the Appellant states that correct address of the Appellant

would be furnished to SEBI for service of notice within one week from today.

3. Both the Appeals as well as Misc. Application are disposed of in the

above terms with no order as to costs.

Sd/-

Justice J.P. Devadhar Presiding Officer

Sd/-

Jog Singh Member 18/3/2016 Prepared & compared by-ddg