Mrs. Meeta Kapoor vs Sebi

BEFORE THE SECURITIES APPELLATE TRIBUNAL MUMBAI Date of Decision : 20.06.2022 Misc. Application No. 562 of 2022 And Appeal No. 288 of 2022 Mr. Pradeep Kapoor B-104, Regency Tower, Vastrapur, Ahmedabad. ..... 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. Anish Shah, PCS for the Appellant. Mr. Vyom Shah, Advocate with Mr. Nishit Dhruva, Mr. Yash Garach, Ms. Meghna Ashwin and Ms. Shefali Shankar, Advocates i/b MDP & Partners for the Respondent. AND Appeal No. 289 of 2022 Mrs. Meeta Kapoor A-7, 103, La Habitat, S G High Way, Thaltej, Nr. Aiyana Complex, Ahmedabad - 390 059. ..... 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. Anish Shah, PCS for the Appellant. Mr. Vyom Shah, Advocate with Mr. Nishit Dhruva, Mr. Yash Garach, Ms. Meghna Ashwin and Ms. Shefali Shankar, Advocates i/b MDP & Partners for the Respondent. CORAM : Justice Tarun Agarwala, Presiding Officer Justice M.T.

Joshi, Judicial Member Ms. Meera Swarup, Technical Member Per : Justice Tarun Agarwala, Presiding Officer (Oral) 1. Two appeals have been filed by the appellants against two orders of the same date October 29, 2021 passed by the Adjudicating Officer ('AO' for short) of the Securities and Exchange Board of India ('SEBI' for short) imposing a penalty of Rs. 1 lakh each. Since the issue is common, both the appeals are being taken up together. For facility, the facts stated in Appeal no. 288 of 2022 (Pradeep Kapoor) has been taken into consideration. 2. A show cause notice was issued to the appellant to show cause as to why penalty should not be imposed for violation of disclosure norms under Regulation 29(2) read with 29(3) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 ('SAST Regulations' for short). It was alleged that the appellant is a shareholder of Golden Capital Services Limited and decreased his shareholding from 6.80% to 1.88% in a series of transaction during the period October 3 26, 2016 to November 04, 2016. In one such transaction on October 28, 2016 the shareholding decreased from 6.02% to 3.90% and there was a change of 2.12%.

It was alleged that the decrease of the shareholding from 6.02% to 3.90% triggered disclosure requirement under Regulation 29(2) read with 29(3) of the SAST Regulations which the appellant failed to disclose. 3. The AO after considering the reply of the appellant and after considering the provisions of law found that since there was a change in shareholding by more than 2%, the appellant was required to make a disclosure within 2 days under Regulation 29(3) which he failed to do so and therefore violated Regulation 29(2) read with Regulation 29(3) of the SAST Regulations. The AO accordingly imposed a penalty of Rs. 1 lakh each. 4. We have heard Shri Anish Shah, PCS for the appellant and Shri Vyom Shah, the learned counsel for the respondent. 5. The contention of the appellant was that the appellant was not aware of the disclosure requirement under SAST Regulations and is a simple graduate and doing only accounting job work. It was alleged that he was facing financial crunch and accordingly sold off his shares without 4 realizing that he was required to make a disclosure where the shareholding dropped by more than 2%.

6. Regulation 29(2) and Regulation 29(3) provides as under:- 7. Under Regulation 29(2) if the shareholding changes by 2% then such disclosure is required to be disclosed within two working days under Regulation 29(3) to the Stock Exchange. In the instant case, no such disclosure was made and 5 consequently the appellant had violated Regulation 29(2) read with Regulation 29(3) of the SAST Regulations. A minimum penalty prescribed under Section 15A has been imposed after considering the factors stipulated under 15J of the SEBI Act. 8. Considering the aforesaid, we do not find any error in the impugned order. Both the appeals fail and are dismissed with no order as to costs. Misc. Application is disposed of. 9. This order will be digitally signed by the Private Secretary on behalf of the bench and all concerned parties are directed to act on the digitally signed copy of this order. Certified copy of this order is also available from the Registry on payment of usual charges. Justice Tarun Agarwala Presiding Officer Justice M.T. Joshi Judicial Member Ms. Meera Swarup RAJALA Digitally signed Technical Member by RAJALAKSHMI 20.06.2022 KSHMI H NAIR Date: 2022.06.29 H NAIR 12:17:51 +05'30' msb