M/S Tushar Oil Food Ltd. vs Sebi

BEFORE THE SECURITIES APPELLATE TRIBUNAL MUMBAI Date of Decision: 08.06.2015

Appeal No. 25 of 2015

M/s Tushar Oil Food Ltd. G-74, 2nd Floor, Pushkar Enclave, Paschim Vihar, New Delhi- 110 063 ...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. Amit Sheth, Advocate for the Appellant.

Mr. Kumar Desai, Advocate with Mr. Pulkit Sukhramani, Advocate i/b The Law Point for the Respondent.

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

Per: Justice J.P. Devadhar (Oral)

1.

Appellant is aggrieved by the adjudication order passed by

Securities and Exchange Board of India ('SEBI' for short) on October

21, 2014, whereby penalty of ` 2 lac is imposed on the appellant under

Section 15C of the Securities and Exchange Board of India Act, 1992.

Reasons for imposing the said penalty is that inspite of SEBI circular

dated August 13, 2012, appellant failed to obtain SEBI Complaints

Redress System ('SCORES' for short) Login ID and Password within

the time stipulated therein for redressing the investor grievances. It is

further held in the impugned order that inspite of advertisements issued

by SEBI on October 06, 2012 and October 21, 2012 calling upon the 2

companies to obtain SCORES Login ID and Password within the time

stipulated therein appellant failed to obtain SCORES Login ID and

Password. It is further held that it is only on issuance of a show cause

notice on February 07, 2014 for initiating penal action, the appellant

applied for and obtained SCORES Login ID and the Password. In these

circumstances, by the impugned order nominal penalty of ` 2 lac is

imposed on appellant under Section 15C of SEBI Act, 1992.

Challenging the said order present appeal is filed.

2. Counsel for the appellant while fairly conceding that the issue

raised in the present appeal is covered by the decisions of this Tribunal

in the cases of M/s. Vidarbha Industries Limited v/s SEBI (Appeal No. 386 of 2014 decided on 01.12.2014) and Rakan Steels Limited v/s SEBI

(Misc. Application No. 124 of 2015 in Appeal No. 379 of 2014 decided

on 10.04.2015) submitted that in the facts of present case the penalty

imposed is excessive, in view of the fact that the appellant company was

not operational during the relevant period and that the investor

grievances have been redressed immediately after obtaining SCORES

Login ID and the Password.

3. We see no merit in the above contentions. Fact that the company

was not operational cannot be a ground to disobey the directions given

by SEBI. Similarly fact that the investor grievances have been redressed

ultimately after obtaining SCORES Login ID and the Password cannot

be ground to justify the inordinate delay in complying with the

directions given by SEBI. In any event, after taking into consideration

all mitigating factors, the Adjudicating Officer of SEBI has imposed 3

penalty of ` 2 lac as against the penalty of ` 1 crore imposable under the

SEBI Act, which cannot be said to be unreasonable or excessive.

4. In these circumstances, we see no reason to entertain the present

appeal.

5. Accordingly, the appeal is dismissed with no order as to costs.

Sd/-

Justice J.P. Devadhar Presiding Officer

Sd/-

Jog Singh Member 08.06.2015 Prepared & Compared By: PK