Gajender Pal Singh vs Sebi
- CitationAppeal No. 151 of 2017
Ratio decidendi
The rule this decision rests on
The appellants' challenge is disposed of by applying the Tribunal's earlier decision in Manoj Agarwal v. SEBI, which the court treats as covering the issues raised, so the reasoning rests on that precedent rather than on any independent principle stated here. Delay in filing appeals is condoned where the issues are covered by a binding decision of the Tribunal. Liability of directors for the company's refund of money collected through redeemable preference shares is confined to the amounts collected during the period when the appellants were directors of the company. A director's exposure to joint and several liability may be limited by excluding amounts collected on the day of resignation where such a point is raised for the first time before the Tribunal; such a plea is to be decided by SEBI on its own merits in a representation, not by the Tribunal itself.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Date of Decision : 06.04.2018
Misc. Application No. 197 of 2017 And Appeal No. 151 of 2017
Kanwal Prakash Singh WA/83-B, Shakarpur, Delhi - 110092. ...Appellant
Versus [[
Securities and 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. 198 of 2017 And Appeal No. 152 of 2017
Gajender Pal Singh S-592C, School Block, Shakarpur, Delhi - 110092. ...Appellant
Versus [[
Securities and 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. 288 of 2017 And Appeal No. 312 of 2017
Virender Kumar U-152, Upadhyay Block, Shakarpur, Delhi - 110092, India ...Appellant Versus [[
Securities and Exchange Board of India, SEBI Bhavan, Plot No. C-4A, G-Block, Bandra-Kurla Complex, Bandra (East), Mumbai - 400 051. ...Respondent 2
Mr. Ravichandra S. Hegde, Advocate with Mr. Paras Parekh and Ms. Kirti S, Advocates i/b Ms. Shreya Bhatnagar and Mr. Vaibhav Mahajan, Advocates for Appellants.
Mr. Mustafa Doctor, Senior Advocate with Mr. Santanu Mitra and Mr. Anubhav Ghosh, Advocates i/b Desai & Diwanji for the Respondent.
CORAM : Justice J.P. Devadhar, Presiding Officer Dr. C.K.G. Nair, Member
Per : Justice J.P. Devadhar (Oral)
Misc. Application Nos. 197, 198 and 288 of 2017 In Appeal Nos. 151, 152 and 312 of 2017
There is delay of 570 days, 570 days and 675 days in filing the
respective appeals. By these three Miscellaneous applications applicants
seek condonation of the said delay. Since the issue raised in these appeals
are covered by the decision of this Tribunal, the delay in filing these three
appeals are condoned. All the three Miscellaneous Applications are disposed
of accordingly.
Appeal Nos. 151 of 2017, 152 of 2017 and 312 of 2017
1.
All these three appeals are filed to challenge the common order
passed by the Whole Time Member ('WTM' for short) of Securities and
Exchange Board of India ('SEBI' for short) on October 13, 2015. By the
said order Just-Reliable Projects India Limited and its directors including
the appellant are, inter alia, jointly and severally directed to refund the
money collected through the issuance of Redeemable Preference Shares to
the investors with interest as more particularly set out therein. 3
2. Counsel for the appellants fairly stated that the issues raised in these
appeals are covered by the decision of this Tribunal in the case of Manoj
Agarwal vs. SEBI (Appeal No. 66 of 2016 decided on 14.07.2017) against
the appellants.
3. Accordingly, we uphold the impugned decision of SEBI dated
October 13, 2015 and take on record the statement made by counsel for
SEBI that the liability of the appellants shall be restricted to the amount
collected during period when the appellants were directors of the company.
4. Counsel for the appellants, however, submitted that in case of
Kanwal Prakash Singh and Gajender Pal Singh the amounts collected by the
company on the day on which they resigned and accepted by the company
be excluded from the joint and several liability imposed on the appellants.
Since this aspect of the matter is raised for the first time, we permit the
above two appellants to make a representation to SEBI limited only to the
above issue. If such representation is made, SEBI shall consider the said
representations on its own merit and pass appropriate order.
5. All the three appeals are disposed of in the above terms with no order
as to costs.
Sd/-
Justice J.P. Devadhar Presiding Officer
Sd/-
Dr. C.K.G. Nair Member 06.04.2018 Prepared and compared by: msb
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