Order in the matter of Apollo Finvest India Limited

WTM/RKA/CFD-DCR/38/2015 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA ORDER Under sections 11 and 11B of the Securities and Exchange Board of India Act, 1992 and regulations 44 and 45 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 read with regulations 32 and 35 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 in respect of: - 1) Mrs. Anju R Innani, 2) Mr. Mikhil R Innani, 3) Mr. Dinesh Innani, 4) Mr. Dinesh R Innani, 5) Ms. Jyoti D Innani, 6) Mr. Narayan Rathi 7) Ms Namita Agarwal In the matter of acquisition of shares of Apollo Finvest (India) Limited. 1. Apollo Finvest (India) Limited (hereinafter referred to as "the target company") is a company having its registered office at Jewel Arcade, Plot 123, TPS IV, Water Field Road, Bandra (West), Mumbai- 400050, India. The shares of the target company are listed on Bombay Stock Exchange Limited ("BSE"). 2. Mrs. Anju R Innani, Mr. Mikhil R Innani, Mr. Dinesh Innani, Mr. Dinesh R Innani, Ms. Jyoti D Innani, Mr. Narayan Rathi and Mrs Namita Agarwal (hereinafter collectively referred to as "the promoter group") were the promoters of the target company as on June 30, 2009 and held 21,95,644 equity shares of the target company constituting 58.69% of the its share capital.

3. It was observed that through a series of acquisitions, Mrs. Anju R Innani, a promoter of the target company acquired 2,30,446 equity shares constituting 6.16% of the shareholding of the target company from June 30, 2009 to June 30, 2010 which led to an increase in the collective shareholding of the promoter group from 21,95,644 shares constituting 58.69% of the share capital of the target company as on June 30, 2009 to 24,26,090 shares constituting 64.85% of the share capital as on June 30, 2010, i.e. an increase of 06.16%. 4. It was observed that on January 15, 2010, Mrs. Anju R Innani acquired 15,000 equity shares of the target company whereby the collective shareholding of the promoter group in the target company Order in the matter of Apollo Finvest India Limited increased from 58.69% to 63.78%, i.e. an increase of 5.09% which was beyond the specified creeping limit of 5% under regulation 11(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as “Takeover Regulations, 1997”). This acquisition triggered the obligation to make a public announcement under regulation 11(2) read with regulation 14(1) of the Takeover Regulations, 1997 within 4 working days from January 15, 2010. Despite such increase, the acquirer (i.e.

Mrs. Anju R Innani) along with persons acting in concert (i.e. the other promoters of the target company) failed to make the requisite public announcement in terms of the Regulations. 5. In view of the above, SEBI issued a show cause notice dated July 2, 2014 (hereinafter referred to as "the SCN") to the promoter group of the target company (hereinafter collectively referred to as "the Noticees") calling upon them to show cause as to why suitable directions under sections 11 and 11B of the Securities and Exchange Board of India Act, 1992 ("SEBI Act") and regulations 44 and 45 of the Takeover Regulations, 1997 read with regulations 32 and 35 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (hereinafter referred to as “Takeover Regulations, 2011”) should not be issued against them. 6. Vide letter dated August 28, 2014, the Noticees sought six weeks time to file reply in the matter. However, no reply was filed by the Noticees within the stipulated time. An opportunity of personal hearing was provided to the Noticees on March 03, 2015 when Mr. R. S. Loona, Advocate appeared and made submissions on their behalf.

Vide letter dated March 09, 2015, the Noticees filed their written submissions inter alia stating the following:- (a) Mr. Narayan T. Rathi expired on August 02, 2011. The Noticees also annexed a duly notarized copy of the Death Certificate of Mr. Narayan T. Rathi. (b) SEBI in the matter of M/s Comfort Fincap Limited (SEBI Adjudication Order No. ASK/RGA/AO/120-127/2014-15 dated January 16, 2015) held as follows “Upon perusal of submissions of the notices and documents available an records, I find that Noticee No.5 expired on December 06, 2014. Copy of Notarized Death Certificate issued by Kolkata Municipal Corporation was taken on record. In this context, I would like to quote the observation of Hon’ble Supreme Court, in Girijanandini Vs Vijendra Narain (AIR 1967 SC 2110), wherein the court observed that in case of personal actions, thot is the actions where the relief sought is personal to the deceased, the right to sue will not survive to or against the representatives and in such cases the maxim “actio personalis moriture cum persona” (personal action dies with the death of person) would apply.

1 am of the view that the proceedings against the Noticee No.5 are liable to be abated without going into the merits of the case. Therefore, the proceedings against Noticee No.5 stands abated.”

(c) In view of the above, the proceedings against the deceased Noticee Mr. Narayan Rathi be abated without going into merit of the case. (d) The Noticees namely, Mr. Diriesh Innani and Mr. Dinesh R lnnarii are one and the same person holding physical shares in different folios. Mr. Dinesh Innarti is holding 451 shares out of which 223 shares are held in folio number D00075, 100 shares are held in folio number D00076, 55 shares are held in folio number 000798 and 73 shares are held in folio number D00799. Mrs. Jyoti lnnani is holding 185 Shares in folio number J00251. (e) The Noticees namely, Mr. Mikhil Innani, Mr. Dinesh lnnani and Mrs. Jyoti D. Innani were included in "Promoter Group" as they are immediate relatives of Mrs. Anju R. Innani. However, they have no role in the management of the target company. Therefore the proceedings against them may kindly be dropped.

(f) The Noticee namely, Ms. Namita Agarwal was holding only 92 shares of the target company and was never part of Promoter group. Her name was mistakenly included in the promoter category in the shareholding pattern submitted by the Company to the stock exchange due to the fact that her father Mr. Umanath Agarwal was a whole time director of the target company. Due to lack of professional guidance, her name was included in promoters group. Pursuant to her representation, the target company has now excluded her name from the promoter group. It is therefore requested that the proceedings against Ms Namita Agarwal may also be dropped (g) It is submitted that the Noticees are promoters of the target company and were jointly holding 58.69% shares of the company on June 30, 2009. The promoter holding of the Company was increased to 64.85% i.e. by 6.17% as on June 30, 2010.

(h) The alleged default was unintentional in nature and the acquisition was made inadvertently by Ms. Anju Innani. She was not well versed with the provisions of Takeover Regulations and was given to understand at all relevant times that SEBI had liberalized the creeping acquisition provisions whereby promoters holding more than 55% shareholding were allowed to acquire additional shares through market purchases. Accordingly, she acquired 15000 shares on January 15, 2010 which triggered the open offer obligation. It is further submitted that no prejudice or loss whatsoever in nature was caused to the investors due to alleged default. Further, no disproportionate gain or unfair advantage was made by the Noticees. There is no change in management or control over the Company.

(i) Out of all the Noticees only Ms. Anju Innani acquired the shares and therefore she is solely taking responsibility of the alleged default. No other Noticee has acquired a single share during the period of alleged default and therefore they should not be held responsible. It is humbly, requested that the charges against all other Noticees (except Mrs. Anju Innani) may kindly be dropped.

(j) Ms. Anju Innani is a single mother and handicapped old lady. Her husband was Managing Director of the company and running the affairs of the company. Mrs. Anju Innani was a housewife at that time and was forced to handle the business of the company due to untimely death of her husband in a tragic road accident. In the same tragic accident, she was also crippled and remained in coma for about 6 months. She is still unable to talk and walk properly. Ms. Anju Innani is not a business woman and she is handling the business of the Company due to forced circumstances and mainly relies on advice of the Company's staff. The alleged default occurred due to lack of proper guidance provided to her by the Company's staff who was not well versed with the complexities of Securities Laws. Further, the default was totally unintentional and technical in nature. It is therefore prayed that a lenient view may kindly be taken in this matter. (k) The Notices are not in a position to perform the obligation of open offer due to following reasons : i. The financials of the Noticees are not sound enough to discharge the obligation for making an open offer at this stage.

Further, SEBI had already initiated adjudication proceedings for non-disclosure against the Noticees. In current financial scenario, it is not possible for the Noticees to make arrangement of funds for open offer. ii. If Noticees make an open offer, then the promoters holding will go much beyond the permissible limit of 75% (assuming 100% success of open offer) and promoters would be required to divest their holdings to comply with Minimum Public Shareholding Requirement within a period of one year through any of the methods prescribed by SEBI. Since overall capital base of the Company is small and trading in the scrip is very thin, it will be very difficult for the promoters to reduce their shareholding through OFS route. Further, considering weak financial condition of the Company, Institutional placements or QIP issue will also not be possible at this stage. (l) Considering these factors, the Noticee Ms. Anju Innani voluntarily proposes to dispose of additionally acquired 43,770 shares (1.17% shares which is in excess of 5% creeping acquisition limit) (i.e. 1.17% of 37,41,008 shares) and transfer the entire sale proceeds to Investor Protection and Education Fund established under SEBI (Investor Protection and Education Fund) Regulations, 2009. The Noticee Ms. Anju Innani is further willing to undergo voluntary debarment from accessing the securities market or dealing in securities for a period of two years, if such debarment will meet the ends of justice.

7. I have considered the SCN, submissions made by the Noticees and other material available on record. I note from the record that Mr. Narayan T. Rathi had expired on August 02, 2011. In view thereof, these proceedings as against Mr. Narayan Rathi shall abate. I also note from the record and the submissions made by the Noticees that Mr. Dinesh Innani and Mr. Dinesh R Innani are one and the same person holding physical shares in different folios. 8. It is an admitted position that consequent to the acquisitions made by Mrs. Anju R Innani (a part of the promoter group of the target company) from June 30, 2009 to June 30, 2010, the total shareholding of the promoter group in the target company increased from 58.69% as on June 30, 2009 to 64.85% as on June 30, 2010. During this period, the acquisition of 15,000 shares by Mrs. Anju R. Innani on January 15, 2010 cumulatively with the previous acquisitions made by her resulted in an increase of the promoter group's shareholding in the target company by 5.09% as a consequence whereof, the obligation to make public announcement under regulation 11(2) of the Takeover Regulations was triggered on January 15, 2010. 9. From the shareholding pattern of the target company, the disclosures filed by it with the stock exchanges and information provided by the target company/its Managing Director - Mrs Anju R. Innani vide letter dated November 11, 2013 to SEBI, it is noted that shares of target company were acquired by Mrs Anju R. Innani, from June 30, 2009 to June 30, 2010 as described in the following Table:-

Date of No. and % of Pre-acquisition Post-acquisition acquisition/Sale shares holding of promoter holding of promoter acquired/ Sold group group July 10, 2009 252 (0.01%) 58.67% 58.68% July 15, 2009 50 (0.00%) 58.68% 58.68% July 16, 2009 200(0.01%) 58.68% 58.69% July 16, 2009 5200 (0.14%) 58.69% 58.82% July 17, 2009 2500 (0.07%) 58.82% 58.89% July 17, 2009 5299 (0.14%) 58.89% 59.03% August 07, 2009 20000 (0.53%) 59.03% 59.57% August 14, 2009 10000 (0.27%) 59.57% 59.83%

August 17, 2009 10000 (0.27%) 59.83% 60.10% August 18, 2009 2500 (0.07%) 60.10% 60.17% August 24, 2009 2500 (0.07%) 60.17% 60.24% August 25, 2009 10000 (0.27%) 60.24% 60.50% August 26, 2009 1000 (0.03%) 60.50% 60.53% August 26, 2009 10,500 (0.28%) 60.53% 60.81% August 31, 2009 495(0.01%) 60.81% 60.82% August 31, 2009 10,500 (0.28%) 60.82% 61.10% September 02, 2009 7,600(0.20%) 61.10% 61.31% September 04, 2009 15,200 (0.41%) 61.31% 61.71% October 15, 2009 5000 (0.13%) 61.71% 61.85% October 21, 2009 10000 (0.27%) 61.85% 62.11% October 22, 2009 10200 (0.28%) 62.11% 62.39% October 26, 2009 (100) (0.00%) 62.39% 62.38% October 26, 2009 10000 (0.27%) 62.38% 62.65% January 06, 2010 500 (0.01%) 62.65% 62.67% January 07, 2010 300 (0.01%) 62.67% 62.67% January 08, 2010 1000 (0.03%) 62.67% 62.70% January 08, 2010 8700 (0.23%) 62.70% 62.93% January 11, 2010 1000 (0.03%) 62.93% 62.96% January 11, 2010 9250 (0.25%) 62.96% 63.21% January 12, 2010 6000(0.16%) 63.21% 63.37% January 13, 2010 600 (0.02%) 63.37% 63.38% January 15, 2010 15000 (0.40%) 63.38% 63.78% January 22, 2010 300(0.01%) 63.78% 63.79% January 25, 2010 5000 (0.13%) 63.79% 63.93% January 27, 2010 12800 (0.34%) 63.93% 64.27% January 28, 2010 7000 (0.19%) 64.27% 64.45% February 03, 2010 852(0.02%) 64.45% 64.48% February 04, 2010 500 (0.01%) 64.48% 64.49% February 08, 2010 500 (0.01%) 64.49% 64.50% February 09, 2010 6010(0.16%) 64.50% 64.66% February 16, 2010 3100(0.08%) 64.66% 64.75% February 17, 2010 4050(0.11%) 64.75% 64.86% February 22, 2010 (3150)(0.08%) 64.86% 64.77%

February 23, 2010 (1000) (0.03%) 64.77% 64.75% February 24, 2010 (2000) (0.05%) 64.75% 64.69% February 24, 2010 (1500) (0.04%) 64.69% 64.65% February 25, 2010 (1500) (0.04%) 64.65% 64.61% February 26, 2010 (2000) (0.05%) 64.61% 64.56% March 04, 2010 (4000)(0.11%) 64.56% 64.45% March 05, 2010 (3000) (0.08%) 64.45% 64.37% March 08, 2010 (4000)(0.11%) 64.37% 64.26% March 09, 2014 (3000) (0.08%) 64.26% 64.18% March 10, 2010 (2000) (0.05%) 64.18% 64.13% March 11, 2010 (4000)(0.11%) 64.13% 64.02% March 15, 2010 (5000) (0.13%) 64.02% 63.89% March 17, 2010 (5000) (0.13%) 63.89% 63.76% March 232010 (5000) (0.13%) 63.76% 63.62% April 29, 2010 300(0.01%) 63.62% 63.63% April 30, 2010 (300)(0.01%) 63.63% 63.62% May 05, 2010 10143 (0.27%) 63.62% 63.89% May 06, 2010 10,500 (0.28%) 63.89% 64.17% May 10, 2010 5,500 (0.15%) 64.17% 64.32% May 12, 2010 3000 (0.08%) 64.32% 64.40% May 21, 2010 15300 (0.41%) 64.40% 64.81%

10. In the present case, it is undisputed that all the Noticees are promoters of the target company and in its joint control. Out of these promoters Mrs. Anju R Innani, Mr. Mikhil R Innani, Mr. Dinesh R Innani and Ms. Jyoti D Innani are members of the same family. It is also relevant to mention that, by their own submission, the Noticees have sought to claim benefit of the 5% creeping acquisition by clubbing the shareholding of all promoters. Such consolidation itself suggests concerted acquisitions by all Noticees for the purpose of common objective to acquire substantial shares in the target company. The Noticees have also not furnished any material to prove anything contrary to this fact. In these facts and circumstances, the community of interests and commonality of objectives of all the Noticees are established in this case. I, therefore, find that all the Noticees were "persons acting in concert" with regard to the acquisitions under consideration. 11. The Noticees have submitted that Ms. Namita Agarwal was never a part of promoter group and due to lack of professional guidance, her name was mistakenly included in the promoter category in the shareholding pattern of the target company as her father (Mr.

Umanath Agarwal) was a whole time director of the target company. Further, upon her representation, the Company has now excluded her name from the promoter group. On that basis the Noticees have contended that the proceedings against Ms Namita Agarwal may be dropped. In this regard, it is noted from the disclosures filed by the target company to BSE that Ms Namita Agarwal was disclosed as a promoter group entity till quarter ended June 30, 2014. It is important to mention that only after issuance of SCN in the instant case, her name was excluded as a promoter group entity in the disclosures filed by the target company for the quarter ended September 30, 2014. I find that since Ms. Namita Agarwal was a part of the promoter group at the time of the acquisitions under consideration, she cannot be absolved from her obligations under the Takeover Regulation, 1997 as a part of the promoter group. I, therefore, reject the contention of the Noticees in this regard. 12. The Noticees have also submitted that out of all the Noticees, only Mrs. Anju R. Innani acquired the shares and therefore she is solely taking responsibility of the alleged default.

No other Noticee has acquired a single share during the period of alleged default and therefore they should not be held responsible. On that basis the Noticees have requested that the charges against all other Noticees (except Mrs. Anju R. Innani) may be dropped. In this regard, I note that in the present case, there is no dispute as to the fact that as a result of the acquisitions made by Mrs. Anju R Innani, the collective shareholding of the promoter group of the target company breached the 5% limit provided under regulation 11(2) of the Takeover Regulations, 1997. As per the Noticees' submissions the acquisitions were made by Mrs. Anju R Innani with the understanding that SEBI had liberalized the creeping acquisition provisions for promoters holding more than 55% shares of the target company. Thus, it is clear that the acquisitions were made by Mrs. Anju R. Innani on behalf of the entire promoter group in order to avail the benefit of the additional 5% limit under regulation 11(2) for promoters holding more than 55% shares of the target company. I have already observed above that other promoters of the target company were acting in concert with Mrs. Anju R Innani when the acquisitions under consideration were made.

It is important to note that under the Takeover Regulations, 1997, the obligations of the acquirers and the persons acting in concert are joint and several. The fact that the persona acting in concert have not made any acquisition on their own does not have any bearing on the collective obligation of the acquirer and the persons acting in concert under the Takeover Regulations, 1997. In view thereof, I reject the contention of the Noticees in this regard. 13. While admitting the default, the Noticees have contended that the alleged default was unintentional in nature and the acquisitions were made inadvertently by Ms. Anju Innani who was not well versed with the provisions of Takeover Regulations, 1997 and was given to understand at all relevant times that SEBI had liberalized the creeping acquisition provisions whereby promoters holding more than 55% shareholding were allowed to acquire additional shares through market purchases. In order to deal with the charges against the Noticees and the above submission of the Noticees, it is necessary to refer to the provisions of regulation 11(2) as amended by inserting second proviso therein with effect from October 30, 2008. The provisions of regulation 11(2) as applicable at the relevant time provided as following:- "Consolidation of holdings.

11.(1).......................................................................................................................................................... (2) No acquirer, who together with persons acting in concert with him holds, fifty five per cent. (55%) or more but less than seventy five per cent. (75%) of the of the shares or voting rights in a target company, shall acquire either by himself or through persons acting in concert with him any additional shares or voting rights therein, unless he makes a public announcement to acquire shares in accordance with these Regulations: Provided that in a case where the target company had obtained listing of its shares by making an offer of at least ten per cent. (10%) of issue size to the public in terms of clause (b) of sub-rule (2) of rule 19 of the Securities Contracts (Regulation) Rules, 1957, or in terms of any relaxation granted from strict enforcement of the said rule, this sub-regulation shall apply as if for the words and figures 'seventy five per cent. (75%)', the words and figures 'ninety per cent. (90%)' were substituted.

Provided further that such acquirer may, without making a public announcement under these Regulations, acquire, either by himself or through or with persons acting in concert with him, additional shares or voting rights entitling him up to five per cent. (5%) voting rights in the target company subject to the following:- (i) the acquisition is made through open market purchase in normal segment on the stock exchange but not through bulk deal /block deal/ negotiated deal/ preferential allotment; or the increase in the shareholding or voting rights of the acquirer is pursuant to a buy back of shares by the target company; (ii) the post acquisition shareholding of the acquirer together with persons acting concert with him shall not increase beyond seventy five per cent.(75%)." 14. In terms of the provisions of regulation 11(2), an acquirer, together with personas acting in concert ("PACs"), holding 55% or more but less than 75% shares or voting rights in a target company could acquire additional shares or voting rights in a target company upto 5% without making a public announcement subject to the following two conditions: (a) the acquisition should be made through open market purchase in normal segment on the stock exchange or it is pursuant to buy back of shares by the target company; and (b) the post acquisition shareholding of the acquirer should not increase beyond 75%.

15. Following the above amendment to regulation 11(2), SEBI received several queries/informal guidance requests regarding the applicability of the amended regulation 11(2) such as – whether the acquisition of 5% under amended regulation 11 (2) is only an interim measure up to March 31, 2009, whether it is only a one-time measure, whether shares can be acquired in several tranches, whether "creeping acquisition" of 5% under regulation 11(2) was available in every financial year, etc. In view of such doubts and ambiguities, SEBI issued an interpretative circular dated August 06, 2009 under regulation 5 of the Takeover Regulations, 1997 for removal of difficulties in interpretation of the second proviso to regulation 11(2). The said circular inter alia clarified that such acquirer, alongwith his PACs, could acquire additional shares or voting right upto a maximum of 5% in a target company in one or more tranches without any restriction on the time-frame without making a public announcement. Accordingly, such acquirers and PACs did not have the benefit of "creeping acquisition" of 5% in every financial year and they could acquire more than 5% shares/voting rights in a target company only by making a public announcement in accordance with Takeover Regulations, 1997. 16. It is worth mentioning that there was no ambiguity in the aforesaid amendment with regard to percentage (5%) of creeping acquisition.

In this case, even after the said amendment on October 30, 2008 and clarification dated August 06, 2009 the Noticees continued to consolidate their shareholding in the target company and it increased from 58.69% as on September 30, 2009 to 64.85% as on September 30, 2010 i.e. 6.16% increase during this period. 17. From the above facts and circumstances it is noted that the Noticees substantially consolidated their shareholding in the target company by acquiring shares when the benefit of creeping acquisition was available to them upto the limit (5%) and even thereafter by breaching the said 5% limit despite the clarification issued by SEBI circular dated August 06, 2009. They, however, failed to make mandatory public announcement in terms of regulation 11(2) read with regulation 14(1) of the Takeover Regulations, 1997. Their subsequent acquisitions clearly prove that the Noticees had little regard for the process of law and or any intent to comply with the requirements of regulation 11(2) of the Takeover Regulations, 1997. It is also noted that the Noticees made those acquisitions clandestinely as they did not disclose their acquisitions to the stock exchange under regulation 7(1A) an other applicable regulations of the Takeover Regulations,1997.

18. Considering the above fats and circumstances, I am of the view that the charge in the SCN against the Noticees is established. Since these acquisitions were clearly in breach of regulation 11(2), the consequences of this breach should follow. In this regard, I note the Hon'ble SAT vide order dated September 08, 2011 in the matter of Nirvana Holdings Private Limited vs. SEBI (Appeal no. 31/2011) observed as follows: "It must be remembered that whenever an acquirer violates Regulation 10, 11 or 12 of the takeover code by not making a public announcement, he should be directed to comply with the provision by making a public offer. The words “unless such acquirer makes a public announcement” appearing in Regulations 10 and 11(1) make these provisions mandatory and a public announcement has to be made. Similar words appear in Regulation 12 as well. These provisions make the acquisition conditional upon a public announcement being made. The primary object of the takeover code is to provide an exit route to the public shareholders when there is substantial acquisition of shares or a takeover.

This right to exit is an invaluable right and the shareholders cannot be deprived of this right lightly. It is only when larger interest of investor protection or that of the securities market demands that this right could be taken away. Therefore, as a normal rule, a direction to make a public announcement to acquire shares of the target company should issue to an acquirer who fails to do that. The Board need not give reasons as to why such a direction is being issued because that is the mandate of Regulations 10, 11 and 12. However, if the issuance of such a direction is not in the interest of the securities market or for the protection of interest of investors, the Board may deviate from the normal rule and issue any other direction as envisaged in Regulation 44 of the takeover code. In that event, the Board should record reasons for deviation ." 19. In the present case, the obligation of the Noticees to make the open offer has been triggered on account of breach of regulation 11(2) of the Takeover Regulations, 1997 and the acquisitions in such breach have been repeated by them. Further, the Noticees made those acquisitions in clandestine manner.

Had the Noticees made the public announcement within a period of 4 days from January 15, 2010 in accordance with the Takeover Regulations, 1997 and complied with all related activities within the timelines specified therein, all formalities with respect to their public announcement and the open offer would have been completed by April 22, 2010. As per the provisions of regulation 20(7) of the Takeover Regulations, 1997, if the acquirer acquires shares after making the public announcement at a price higher than the offer price, then the highest of the price paid for such acquisition shall be payable in the open offer. Thus, the acquirer along with PACs could have acquired further shares only in compliance of these regulations. In this case, the Noticees not only failed to make the public announcement within 4 days from January 15, 2010 but also made further acquisitions in breach of the Takeover Regulations, 1997. The details of subsequent acquisitions made by the Noticees are as follows:

Date of acquisition No. and % of shares acquired Price of acquisition (in ₹) January 22, 2010 300(0.01%) 13.56 January 25, 2010 5000 (0.13%) 14.13 January 27, 2010 12800 (0.34%) 14.74 January 28, 2010 7000 (0.19%) 14.85 February 03, 2010 852(0.02%) 13.49 February 04, 2010 500 (0.01%) 14.06 February 08, 2010 500 (0.01%) 14.06 February 09, 2010 6010(0.16%) 14.09

February 16, 2010 3100(0.08%) 14.45 February 17, 2010 4050(0.11%) 14.55 February 22, 2010 (3150)(0.08%) 12.54 February 23, 2010 (1000) (0.03%) 11.98 February 24, 2010 (2000) (0.05%) 11.60 February 24, 2010 (1500) (0.04%) 11.79 February 25, 2010 (1500) (0.04%) 12.01 February 26, 2010 (2000) (0.05%) 11.64 March 04, 2010 (4000)(0.11%) 11.98 March 05, 2010 (3000) (0.08%) 11.62 March 08, 2010 (4000)(0.11%) 10.81 March 09, 2014 (3000) (0.08%) 10.96 March 10, 2010 (2000) (0.05%) 11.20 March 11, 2010 (4000)(0.11%) 10.77 March 15, 2010 (5000) (0.13%) 10.55 March 17, 2010 (5000) (0.13%) 10.45 March 232010 (5000) (0.13%) 10.36 April 29, 2010 300(0.01%) 13.94 April 30, 2010 (300)(0.01%) 12.28 May 05, 2010 10143 (0.27%) 15.54 May 06, 2010 10,500 (0.28%) 15.48 May 10, 2010 5,500 (0.15%) 15.46 May 12, 2010 3000 (0.08%) 15.00 May 21, 2010 15300 (0.41%) 14.95

20. Thus, had the Noticees made the public announcement within the time stipulated in regulation 14 of the Takeover Regulations, 1997, the price offered to the shareholders in the open offer could have been determined taking into consideration the highest of the price of such acquisitions. It is also relevant to mention that at the relevant time the shares of the target company were infrequently traded on the stock exchange. I find that the Noticees have deprived the shareholders the exit opportunity at the best offer price. In the facts and circumstances of the present case, I do not find any reason to deviate from the normal rule to make a public announcement to acquire shares of the target company in accordance with the provisions of Takeover Regulations, 1997, and issue any other direction as envisaged in regulation 44. Further, for the same reasons, the proposal of the Noticees to dispose of the shares acquired in excess of 5% and transfer the proceeds thereof to the SEBI (Investor Protection and Education Fund) along with voluntary debarment of Mrs. Anju R Innani for a period of two years cannot be accepted.

21. I am also of the view that since the public announcement now would provide a delayed exit opportunity to the shareholders of the target company, the Noticees should pay interest on the consideration amount to the shareholders who tender their shares in the open offer and who are eligible for interest as per law. 22. Considering the above, I, in exercise of powers conferred upon me under sections 11, 11B read with section 19 of the Securities and Exchange Board of India Act, 1992 and regulation 44 and 45 of the Takeover Regulations, 1997 read with regulations 32 and 35 of the Takeover Regulations, 2011, hereby issue the following directions: (a). Mrs. Anju R Innani, Mr. Mikhil R Innani, Mr. Dinesh R Innani, Ms. Jyoti D Innani and Ms Namita Agarwal shall make a public announcement to acquire shares of the target company in accordance with the provisions of the Takeover Regulations, 1997, within a period of 45 days from the date of this order; (b). The Noticees shall, alongwith the consideration amount, pay interest at the rate of 10% per annum from April 23, 2010 to the date of payment of consideration, to the shareholders who were holding shares in the target company on the date of violation and whose shares are accepted in the open offer, after adjustment of dividend paid, if any.

23. This order shall come into force with immediate effect. A copy of this order shall be served upon the Noticees for ensuring compliance with the above directions.

Sd/-

DATE: MAY 13th, 2015 RAJEEV KUMAR AGARWAL PLACE: MUMBAI WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA