Kss Ltd. vs Sebi

Date of Decision : 23.07.2019

Appeal No. 274 of 2018

KSS Ltd. Unit No. 101A and 102, 1st Floor, Plot No. B-17, Morya Landmark - II, Andheri (West), Mumbai - 400053. ..... 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

Mr. Pulkit Sharma, Advocate with Mr. Saurabh Bachhawat, Advocate i/b Lalit Joshi for the Appellant. Mr. Kumar Desai, Advocate with Mr. Chirag Bhavsar, Advocate i/b MDP & Partners for the Respondent.

CORAM : Justice Tarun Agarwala, Presiding Officer Dr. C. K. G. Nair, Member Justice M. T. Joshi, Judicial Member

Per : Justice Tarun Agarwala, Presiding Officer (Oral)

1.

We have heard the learned counsel for the parties. Against the

ex-parte order dated May 11, 2018 the present appeal has been filed

for alleged violation of non-disclosure of the pledged shares by the

promoters and non-implementation of the certain corporate

announcements. A show cause notice dated November 24, 2017 was 2

issued. After receiving the complete copy of the show cause notice,

the appellant prayed on April 20, 2018 before the Adjudicating

Officer (hereinafter referred to as, 'AO') seeking six weeks time to

file a reply. The AO however, granted only three weeks time to file a

reply and fixed May 8, 2018 for hearing.

2. It transpires that on May 7, 2018, the appellant wrote a letter

requesting three weeks further time to file a reply. This request was

apparently rejected and the impugned order was passed.

3. Considering the facts and circumstances that have been brought

on record, we are of the opinion that the appellant was not delaying

the proceedings and therefore, the AO ought to have granted further

time to file a reply. Denial of such right amounts to violation of the

principles of natural justice. Consequently, on this short ground the

impugned order dated May 11, 2018 in so far as it relates to the

appellant cannot be sustained and is quashed though, in our opinion,

the appellant is equally to be blamed for the ex-parte proceedings as

it had sent the adjournment letter one day before the date of hearing.

Thus, the appeal is allowed on payment of costs of Rs. 50,000/-

which shall be deposited before SEBI on or before the date fixed by

us hereinafter.

3

4. The matter is remitted to the AO to decide the matter afresh

after giving an opportunity of hearing to the appellant.

5. For the aforesaid purpose, we direct the appellant to appear

through its authorized representative on August 23, 2019 alongwith

his reply. It is made clear that no further time will be granted to the

appellant to file his reply. Upon receipt of the reply, the AO will

proceed from there onwards and after providing an opportunity of

hearing shall decide the matter within four months thereafter.

Sd/-

Justice Tarun Agarwala Presiding Officer

Sd/-

Dr. C. K. G. Nair Member

Sd/-

Justice M. T. Joshi Judicial Member 23.07.2019 Prepared & Compared by PTM