Rose Valley Real Estates And ... vs Sebi

Date of Decision : 26.08.2015

Misc. Application No. 201 of 2015 In Appeal No. 233 of 2014

1.

Rose Valley Real Estates and Construction Limited

2. Goutam Kundu

3. Shibamoy Dutta

4. Abir Kundu

5. Ram Lal Goswami

Address at :

Godrej Water Site, Tower No. 1, 2nd Floor, Office No. 201 & 202, Plot No. 5, Block-DP, Sector-5, Salt Lake City, ...Applicant / Kolkata - 700 091. 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. Sudipto Sarkar, Senior Advocate with Ms. Moushmi Bhattacharya, Ms. Ravela D'Souza and Mr. Ajay Hailkar, Advocates i/b Bachubhai Munim & Co. for Applicants / Appellants.

Mr. Darius Khambata, Senior Advocate with Mr. Mihir Mody, Mr. Rushin Kapadia and Ms. Shruti Chiniwar, Advocates i/b K. Ashar & Co. for the Respondent.

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

Per : J.P. Devadhar (Oral)

1. By this Misc. Application Appellants seek extension of time to

comply with our order passed in Appeal No. 233 of 2014 on December 15,

2014.

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2. When Appeal No. 233 of 2014 was taken up for hearing on

December 15, 2014, learned senior counsel Mr. Sudipto Sarkar submitted

that the Appellants are ready and willing to comply with the order of

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

June 18, 2014 by selling the properties and assets belonging to the

Appellants and its directors. Accepting the said statement, this Tribunal

disposed of the appeal by directing the Appellants and its directors to sell

the properties belonging to them under the supervision of SEBI within six

months so that the sale proceeds received there-under are distributed to the

investors from whom the monies have been collected by the Appellants.

3. In the Misc. Application it is stated that pursuant to order passed by

the Calcutta High Court on April 21, 2015 the properties belonging to the

Appellants are being sold under the supervision of a Committee constituted

by the Calcutta High Court and since the Committee would take some time

to sell the properties / assets belonging to the Appellants, by way of

Miscellaneous Application Appellants are seeking extension of time to

comply with the order passed by this Tribunal on December 15, 2014.

4. On perusal of the order passed by the Calcutta High Court on

April 21, 2015 it is seen that very same senior counsel Mr. Sudipto Sarkar

who appeared before this Tribunal on December 15, 2014 appeared before

the Calcutta High Court and submitted that an independent person should be

appointed who, under the supervision of the Court (Calcutta High Court)

could sell the properties belonging to the Appellants and make disbursement

of funds to the investors. When this Tribunal had passed an order on

December 15, 2014 directing that the properties belonging to the Appellants

and its directors be sold under the supervision of SEBI, it was not proper on 3

part of Mr. Sudipto Sarkar, learned senior counsel appeared on behalf of the

Appellants to submit before the Calcutta High Court that an independent

person should be appointed to sell the properties belonging to the

Appellants.

5. In the present case, Appellants had collected huge amounts from the

investors under the Collective Investment Scheme (CIS) in violation of CIS

Regulations framed by SEBI. Under the SEBI Act, SEBI is empowered to

regulate the CIS and accordingly SEBI had passed appropriate order against

the Appellants. When the order of SEBI was accepted by the Appellants and

this Tribunal had directed that the properties belonging to the Appellants be

sold under the supervision of SEBI, Appellants are not justified in obtaining

an order from the Calcutta High Court behind the back of SEBI. Counsel for

the Appellants state that in July 2105, Appellants have made an application

before the Calcutta High Court for inducting SEBI in the Committee

constituted by the Calcutta High Court for disposing the assets of the

Appellants and the said application is pending. In our opinion the conduct of

the Appellants is highly deplorable.

6. In any event, as on date, jurisdiction of SEBI to supervise sale of

properties belonging to the Appellants as ordered by this Tribunal stands

divested pursuant to the order passed by the Calcutta High Court. Since

Calcutta High Court is seized of the matter relating to sale of the properties

belonging to the Appellants question of our granting extension of time to the

Appellants to sell their property does not arise.

7. In these circumstances, we have no option but to reject the

Miscellaneous Application filed by the Appellants. SEBI is directed to take

appropriate steps in the matter so that the interests of investors are properly

secured.

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8. Miscellaneous Application is dismissed accordingly with no order as

to costs.

Sd/-

Justice J.P. Devadhar Presiding Officer

Sd/-

Jog Singh Member 26.08.2015 Prepared and compared by:

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