Jetking Infotrain Ltd vs Bse Limited

IN THE SECURITIES APPELLATE TRIBUNAL AT MUMBAI DATED THIS THE 8TH DAY OF MAY, 2026 CORAM: Justice P.S. Dinesh Kumar, Presiding Officer Ms. Meera Swarup, Technical Member Dr. Dheeraj Bhatnagar, Technical Member Appeal No.474 of 2025 Jetking Infotrain Ltd. Office No.503, 5th Floor, Amore Commercial Premises Co-op Society Ltd., CTS No. Junction of 2nd & 4th Road, Khar (West), Mumbai - 400052. ...Appellant (By Mr. Ravi Kadam, Senior Advocate with Mr. Rohan Kadam, Mr. Nishith Desai, Mr. Viral Mehta, Mr. Suril Desai, Mr. Mohammad Kamran, Ms. Khyati Dalal, Mr. Chitransh Vijayvergia, Mr. Nav Dhawan, Ms. Parina Muchhala, Ms. Shruti Dhonde, Advocates i/b. Nishith Desai Associates, for the Appellant) BSE Limited Phiroze Jeejeebhoy Limited Dalal Street, Fort, Mumbai-400001, India. ...Respondent (By Mr. Shiraz Rustomjee, Senior Advocate with Mr. Tomu Francis, Mr. Arka Saha, Ms. Smriti Singh, Mr. Tarun Toprani, and Ms. Manal Shah, Advocates i/b. Khaitan & Co. for the Respondent) THIS APPEAL IS FILED UNDER SECTION 22A OF THE SECURITIES CONTRACTS (REGULATION) ACT, 1956 TO SET ASIDE THE ORDER/COMMUNICATION DATED SEPTEMBER 23, 2025 PASSED BY THE BSE.

2 THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR ORDERS ON MAY 5, 2026 COMING ON FOR PRONOUNCEMENT OF ORDER THIS DAY, THE TRIBUNAL MADE THE FOLLOWING: ORDER Per: Justice P. S. Dinesh Kumar, Presiding Officer This appeal is directed against order/communication dated September 23, 2025 passed by the BSE1 conveying that appellant's application for listing of shares issued in the preferential issue cannot be considered. 2. Brief facts of the case are, Jetking Infotrain Limited ('appellant Company/Company' for short) is listed on the Bombay Stock Exchange ('BSE' for short). It is an IT and network training institution. Its shareholders approved insertion of new object clause in the memorandum of association ('MoA' for short) to invest, acquire, hold, sell, trade and deal in any type of virtual digital assets ('VDAs' for short). On November 4, 2024, the Registrar of Companies ('RoC' for short) certified the amendment to the MoA. Appellant made an application to the BSE for an 'in-principle approval' for issue and allotment of equity shares on preferential basis and on May 9, 2025, BSE granted the 'in-principle approval'.

Appellant Company circulated offer letter to the proposed pre-identified investors. On May 23, 2025, appellant Company received the issue proceeds and invested in virtual digital assets on the 'Coin DCX Exchange' 1 BSE Limited 3 platform. On June 10, 2025, the Company filed an application and sought listing of the shares issued in the preferential issue. On September 23, 2025, BSE returned the listing application and it is under challenge in this appeal. 3. We have heard Mr. Ravi Kadam, learned Senior Advocate for the appellant and Mr. Shiraz Rustomjee, learned Senior Advocate of the SEBI. 4. Mr. Kadam submitted that in the AGM2 of the Company held on September 20, 2024, the shareholders approved the amendment to the objects to enable the Company to invest, acquire, hold, sell, trade and deal in any of the virtual or digital assets. This amendment was approved by the RoC. In November 2024, Company's Board approved the treasury reserve policy to invest in virtual digital assets. 5. On April 1, 2025, Company's Board approved issuance of equity shares on preferential allotment to certain pre-identified investors, both promoters and non-promoters.

BSE granted an 'in-principle approval', based on which Company proceeded ahead and circulated an offer letter. During May 2025, preferential shareholders paid the application money and it was utilised to purchase VDAs. 6. Mr. Kadam submitted that as early as in September, 2024, the objects in the MoA were amended and RoC had approved the same on November 4, 2024. That amendment permitted the Company to invest and trade in VDAs. The second amendment 2 Annual General Meeting 4 was brought with the approval of the Board on April 1, 2025. The RoC has approved the second amendment on July 7, 2025. 7. He contended that Company had all the power and authority to invest and deal in the VDAs pursuant to the first amendment and its approval by the RoC. After receipt of the impugned communication, appellant informed the BSE about the first amendment but BSE has not reconsidered the matter. 8. In reply, Mr. Rustomjee, learned Senior Advocate for the BSE submitted that as on the date of consideration of Company's application there was no approval by the RoC. Amplifying his contention, he submitted that investment in VDAs could not be treated legitimate prior to approval by the RoC on July 7, 2025. 9. With regard to the first amendment, he submitted that first amendment permitted the Company to invest in VDAs by utilising its surplus funds.

It did not permit the Company to do business in VDAs. He submitted that there is a classic difference between investing Company's funds in VDAs and doing business in VDAs. Justifying the impugned communication, he submitted that since the Company did not have RoC's approval for the second amendment as on the date of investment in VDAs, such investment is ultra vires the MoA. Therefore, there is no error in the impugned communication. 10. We have carefully considered the rival contentions and perused the record. 11. Undisputed facts of the case are, the MoA was amended twice. The first amendment was approved by the shareholders 5 in the AGM3 on September 20, 2024 and the RoC approved the same on November 4, 2024. That amendment reads as follows: 12. The second amendment was approved by the shareholders on May 1, 2025. On July 7, 2025, the RoC approved the amendment of objects clause to insert clause 5(III)A and issued a certificate. The second amendment reads as follows: (Emphasis supplied) 13. It is also not in dispute that BSE gave its 'in-principle approval' for issue of preferential share on May 9, 2025. The Company received share application money and utilised it to invest in VDAs.

Admittedly, appellant Company did not inform the BSE about the first amendment before obtaining the 'in- principle approval' or while submitting the application on 3 Annual General Meeting 6 June 10, 2025 seeking listing of shares. It is only after the BSE returned the listing application, the Company brought the first amendment to its notice. BSE for reasons best known did not respond. Feeling aggrieved, appellant Company has challenged BSE returning the listing application. 14. In the light of the above facts the point that arises for consideration is, whether based on the first amendment, the appellant Company is entitled for consideration of its application for listing? 15. Company's main aims and objects mentioned in clause III(A) prior to the first amendment and post first amendment4 are exactly the same and they read as follows: 16. It is relevant to note that the main aims and objects of the Company were amended by adding para 5 in Clause III(A) by the second amendment5, which reads as follows: (Emphasis supplied) 17. It is relevant to note that there was no change in the main objects after first amendment, whereas pursuant to second amendment, the above para has been added in the main object's clause.

18. Mr. Kadam's main argument is, the first amendment permitted the Company to invest, acquire, hold, sell, trade and deal in any type of virtual and digital assets and it was approved by the RoC on November 4, 2024. Therefore, all actions taken by the Company in furtherance of the first amendment are fully valid in law. His next argument is, the second amendment is only to elaborate the scope of first amendment by which the Company also could develop, deploy and manage blockchain- based technologies, virtual digital assets, decentralized finance platforms and related services. It was argued that BSE has failed to notice that by virtue of the first amendment, the Company had all power to do such acts and deeds mentioned in the first amendment extracted above. 19. Per contra, Mr. Rustomjee's contention is that the first amendment is of no consequence inasmuch as it is an amendment to the ancillary objects and it cannot be operated independently. 20. Both Mr. Kadam and Mr. Rustomjee have relied upon Dr. A. Lakshmanaswami Mudaliar6. In that case, United India Life Assurance Company had donated ₹2 Lakhs from shareholders account to a charitable Trust.

That donation was challenged by the LIC after the Company was merged into it under the LIC Act, 1956. The Apex Court held that the donation was ultra vires because there was no clause in the memorandum authorising such contribution. Mr. Kadam argued that in the instant case clause III (B) authorised the Company to invest, acquire and deal in virtual and digital assets and sought to distinguish the said authority. We may usefully note that in Dr. A. Lakshmanaswami Mudaliar, it is recorded thus: Dr. A. Lakshmanaswami Mudaliar and Others v. LIC and Another, 1962 SCC OnLine SC 9 10 and ultimately, the Apex Court has held thus: 21. Mr. Kadam also relied upon The Barium Chemicals Ltd7 and Amarendra Kumar Pandey8; and contended that the first amendment contains the words 'deemed necessary or desirable for the business'. Therefore, the inevitable corollary is that where a company determines particular matter is in furtherance of its objects, such determination is conclusive. In our view, these authorities do not lend any support the appellant because the said words are found in the amendment to the 'ancillary objects clause'.

22. He next contended that law draws a clear distinction between absence of corporate capacity and abuse of an existing power and argued that where power exists in the MoA, any exercise thereof is not ultra vires or nullity. He submitted that the said proposition is authoritatively settled in Rolled Steel Products (Holdings) Limited9. 23. As noted hereinabove, the point for consideration in this case is whether the first amendment permitted investment and dealing in VDAs. It was argued by Mr. Rustomjee that relying 7 The Barium Chemicals Ltd and Another v. SH.A.J. Rana and Others, (1972) 1 SCC 240 8 Amarendra Kumar Pandey v. Union of India, (2024) 15 SCC 401 9 Rolled Steel Products (Holdings) Ltd. v. British Steel Corporation and Others, 1985 WLR 908 11 upon Dr. A. Lakshmanaswami Mudaliar10, the Apex Court in Terrascope Ventures Limited11 has held that an ultra vires act cannot be ratified. We note that in Terrascope Ventures Limited, it is held as follows: 24. It was urged by Mr. Kadam that in Companies Act, 2013, there is no classification such as 'main objects' and 'ancillary objects'.

Adverting to Section 4 of the Companies Act, 2013, he submitted that Section 4 mandates that memorandum of a company shall state the objects for which the company is proposed to incorporate and any matter considered necessary in furtherance thereof. He submitted that the company and the shareholders have consciously considered it necessary to provide for investment in VDAs as a matter to be in furtherance of Company's MoA objects. 25. It is relevant to note that Schedule I corresponding to Section 4 and 5 of Companies Act, 2013 provides the manner in which the memorandum of association of a company shall be prepared. The first clause is the name of the company, second is 10 Dr. A. Lakshmanaswami Mudaliar and Others v. LIC and Another, 1962 SCC OnLine SC 9 11 SEBI v. Terrascope Ventures Limited, (2026) SCC OnLine SC 403, 2026 INSC 245. the State in which the registered office is situated and clause No.3 which is relevant in this case reads as follows: 26. The admitted position in the pleading12 is, while applying for the first amendment, the Company has expressly sought for amendment by adding para 13 under Clause III (B) of the MoA.

Accordingly, the amendment was approved by the RoC. While applying for the second amendment, the Company has sought the amendment by adding para 5 under Clause III (A) of the MoA. 27. Schedule I extracted above makes a clear distinction in 3(a) and 3(b). The objects to be pursued by the company are required to be stated in 3(a), whereas matters which are necessary for furtherance of objects specified in clause 3(a) are required to be stated in 3(b). 28. Thus, it is clear that by the first amendment the Company sought amendment to clause 3(b) of the schedule i.e. matters necessary for furtherance of objects in clause 3(a). It is also an admitted position that as on the date of submitting the listing application, there was no amendment to clause 3(a). While rejecting the application, BSE has stated that the MoA of the Company did not permit raising funds and to invest in VDAs. This factual matrix is incontrovertible. Therefore, the Company calling 12 Para 6.2 of the memorandum of appeal. for investment by the proposed pre-identified investors and all subsequent actions prior to July 7, 2025, on which the RoC approved the amendment of Clause 5 (III) A, are ultra vires.

29. BSE has rejected the application on the following grounds: 30. It was submitted by Mr. Rustomjee that this Tribunal may restrict consideration of this appeal only so far as the amendment to the MoA is concerned i.e. reasons (i) above. Hence, we have not considered the ground Nos. (ii) and (iii) mentioned above. 31. In the light of above discussion and the law laid down in Terrascope Ventures Limited13, no exception can be taken to the impugned communication. Accordingly, the point for consideration is answered in the negative. SEBI v. Terrascope Ventures Limited, (2026) SCC OnLine SC 403, 2026 INSC 245 14 32. Hence, the following: