Manish Mittal & Ors. vs Sebi

2020. Justification given by the appellants for not preferring an

appeal before this Tribunal was that the Tribunal was not

properly functioning on account of non-availability of a judicial

member and, on that account, had preferred a Writ Petition

before Delhi High Court on October 10, 2018.

4. On the other hand, the learned senior counsel Sri Fredun

De Vitre for SEBI as well as the learned senior counsel Sri

Venkatesh Dhond appearing for respondent no. 4 and Sri

Gyanendra Kumar for respondent no. 3 have vehemently

opposed the application for condonation of delay contending

that no sufficient cause has been shown by the appellants for

condoning the delay. It was contended that there is an

inordinate delay which has not been explained and the appeal

filed is neither bonafide nor filed in good faith. It was also

urged that the appellants are in a habit of forum hunting as and

when it suits them. No explanation has been given as to why

the appeal could not be preferred before the Tribunal after

passing of the impugned order when admittedly the Tribunal

was functioning.

6

5. Sri Gaurav Joshi the learned senior counsel for the

appellants urged that an identical order was set aside by this

Tribunal in the matter of Ashok Dayabhai Shah & Ors Vs.

SEBI & Ors. In Appeal No. 428 of 2019 decided on 14.11.2019

and therefore contended that the impugned order may be set

aside and SEBI may be directed to reconsider their complaint

against the private respondents. The learned senior counsel Sri

Gaurav Joshi further submitted that SEBI had challenged the

order of this Tribunal dated 14.11.2019 by filing Civil Appeal

No. 363 of 2020 which was dismissed by the Supreme Court by

an order dated 27.01.2020 and that the order of this Tribunal

was affirmed. Learned senior counsel Sri Joshi thus contended

that a similar order may be passed in the present appeal.

6. In this regard Sri Kaushik Chatterjee learned counsel for

Calcutta Stock Exchange Limited submitted that SEBI had

directed the Calcutta Stock Exchange to investigate the

companies which included the private companies arrayed in the

present appeal and, in this regard, the Calcutta Stock Exchange

(CSE) after investigating the matter has submitted a report to

SEBI in December 2019.

7

7. Having heard the learned counsel for the parties at some

length. We find that there is an inordinate delay of 834 days in

filing the present appeal. The impugned order is dated

December 20, 2017 and the appeal has been preferred after

more than 2 and ½ years on February 20, 2020. The limitation

for filing the appeal under Section 15T of the SEBI Act is 45

days from the date of the order. The contention that the

Tribunal was not functioning properly as the members were not

available is erroneous in as much as the Presiding Officer who

was a Judicial Member along with the Technical Member were

functioning till July 10, 2018 and thereafter the Tribunal was

entertaining the appeals which continued till December 2018

and thereafter on January 01, 2019 a new Presiding Officer took

charge. Thus, the appeal could have been filed during this

period. The explanation given is clearly an afterthought

especially when we find that some of the present respondents

had filed an Appeal No. 233 of 2017 against some order of the

Calcutta Stock Exchange wherein the appellants had filed an

intervention application during the same period. Thus it is clear

that the appellants were aware that they could have filed an

appeal against the impugned order before this Tribunal but for

the reasons best known the appellants chose the forum of a Writ

Jurisdiction before the Delhi High Court. 8

8. We also find that in an identical matter in the case of

Ashok Dayabhai Shah (supra) the Tribunal had set aside the

order of SEBI on the SCORES platform by judgement dated

14.11.2019. Considering this judgement, the appellants

withdrew the writ petition from the Delhi High Court on

29.11.2019 and has now filed present appeal seeking a similar

relief. The conduct of the appellants makes it clear that they are

only interested in forum shopping to suit their convenience.

9. In the light of the aforesaid, we are of the opinion that

there is an inordinate delay in filing the appeal. No valid or

bonafide explanation has been given by the appellants as to why

they could not prefer the appeal between January 2018 to

October 2018. In the absence of any plausible explanation, we

are of the opinion the appellants have not shown any sufficient

cause for condoning the delay. The appeal is neither bonafide

nor has been filed in good faith and is a clear case of forum

hunting.

10. In Basawaraj and Anr. vs. Special Land Acquisition

Officer, (2013) 14 SCC 81 the Supreme Court held that the

discretion to condone the delay has to be exercised judicially

based on facts and circumstances of each case and that 9

sufficient cause cannot be given a liberal interpretation if lack of

bonafide is attributed to a party. The Supreme Court further

held that delay cannot be condoned on equitable ground beyond

the limits permitted expressly by statute.

11. The Supreme Court in Ram Nath Sao and Ors. (supra)

held that the expression „sufficient cause‟ should receive a

liberal construction so as to advance substantial justice when no

negligence or inaction or want of bonafide is imputable to

a party. The same view was reiterated by the Supreme Court

in Madanlal vs. Shyamlal, (2002) 1 SCC 535.

12. In Balwant Singh (Dead) vs Jagdish Singh & Ors,

(2010) 8 SCC 685 Supreme Court held that the expression

"sufficient cause" means the presence of legal and adequate

reasons. The decisions cited by the learned counsel for the

appellant are of no avail and, in any case, not applicable in

the present circumstance of the case.

13. This Tribunal is possessed with the exercise of judicial

discretion in condoning the delay if sufficient or adequate

reason is given. It is also a settled proposition of law that the

law of limitation may harshly affect a particular party but it 10

has to be applied with all its rigour when the statute so

prescribes. The court has no power to extend the period of

limitation on equitable grounds as held by the Supreme Court

in Basawaraj and Anr. (supra).In the instant case we do find

any legal or adequate reasons to condone the delay.

14. Thus for the reasons stated aforesaid, we do not find any

reason to condone the inordinate delay in filing the appeal. The

Misc. Application No. 153 of 2020 for condoning the delay is

rejected on the ground of laches as a result of which Appeal No.

144 of 2020 is also dismissed with no order as to costs.

15. We had made a query to the learned senior counsel for the

respondents as to whether there is a bar for an investor to file a

fresh complaint on the SCORES platform. We find that there is

no bar. Further, the impugned order did not resolve the issues

raised by the appellants. The respondent no. 1 disposed of the

complaint in a mechanical manner. Thus it is always open to the

appellants to file a fresh complaint for resolution of its

complaints. Thus, while dismissing the appeal, we direct that in

the event the appellants files a fresh complaint within four

weeks from today before SEBI the same shall be tagged with

the complaint of Ashok Dayabhai Shah and others which is 11

under investigation and SEBI will be under an obligation to

decide the complaint of the appellants in accordance with law.

16. The present matter was heard through video conference

due to Covid-19 pandemic. At this stage it is not possible to sign

a copy of this order nor a certified copy of this order could be

issued by the Registry. In these circumstances, this order will be

digitally signed by the Presiding Officer on behalf of the bench

and all concerned parties are directed to act on the digitally

signed copy of this order. Parties will act on production of a

digitally signed copy sent by fax and/or email.

TARUN Digitally signed by TARUN AGARWAL DN: c=IN, st=Uttar Pradesh, 2.5.4.20=a0e08b2d80e9d23c2c2aa Justice Tarun Agarwala AGAR 3e16780d684adad6bc9e810de2d7 b0c28efd35557c9, postalCode=211001, street=B/ A,NYAYA MARG ALLAHABAD, Presiding Officer serialNumber=095f8b286bb0b1cd

WAL 07ff676611f4f5e7999727d404aa38 ca422f9d3529bdb8a3, o=Personal, cn=TARUN AGARWAL Date: 2020.06.26 11:48:15 +05'30'

Dr. C.K.G. Nair Member

Justice M. T. Joshi Judicial Member 25.06.2020 PK