Sanjay Lai vs Sebi

Date of Decision: 17.09.2019

Appeal No. 113 of 2019

Sanjay Lai 104 Palak Apartment, 57 Bhosale Nagar, Pune, Maharashtra- 411 007 ...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. Saurabh Bachhawat, Advocate with Mr. Lalit Joshi, Advocate i/b Ms. Shubhangi Chavan, Advocate for the Appellant.

Mr. Karan Bhosale, Advocate with Mr. Chirag Bhavsar, Advocate i/b MDP & Partners for the Respondent.

CORAM: Justice Tarun Agarwala, Presiding Officer Dr. C.K.G. Nair, Member Justice M. T. Joshi, Judicial Member

Per: Justice Tarun Agarwala (Oral)

1.

Against the order of the Adjudicating Officer ("AO" for

convenience) of Securities and Exchange Board of India

("SEBI" for convenience) dated May 11, 2018 imposing a

penalty of ` 10 lakhs for violation of Regulation 8A(4) of the 2

Securities and Exchange Board of India (Substantial Acquisition

of Shares and Takeovers) Regulations, 2009 the present appeal

has been filed. The basic ground urged is that neither the show

cause notice was served nor an opportunity was provided to the

appellant before passing the impugned order. We find from

paragraph 8 of the impugned order that the show cause notice

was returned undelivered and thereafter the same was served by

affixation on the same address presumably since details are

lacking in the impugned order.

2. We however find that the notice of demand pursuant to the

impugned order was served upon the appellant at his Pune

address based on which the appellant came to know of the

impugned order and thereafter the appeal was filed. Apparently,

the show cause notice was not sent nor served at the Pune

address of the appellant. It was served at the Goregaon address

in Mumbai where the appellant contends that he was previously

residing.

3. We also find that pursuant to a show cause notice the

company was also served and similar order of penalty of ` 10

lakhs was also passed against the company. The said company

filed an Appeal No. 274 of 2018 which was allowed and the 3

impugned order was set aside on the ground of violation of the

principles of natural justice. The matter has been remitted to the

AO of SEBI to decide the matter afresh on merit after giving an

opportunity of hearing to the appellant.

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

since adequate opportunity was not given to the appellant, the

impugned order cannot be sustained and consequently, the

impugned order is set aside in so far as the appellant is

concerned. The matter is remitted to the AO of SEBI to pass a

fresh order after giving an opportunity of hearing.

5. For the aforesaid purpose the appellant shall appear before

the AO of SEBI on October 04, 2019.

Sd/-

Justice Tarun Agarwala Presiding Officer

Sd/-

Dr. C.K.G. Nair Member

Sd/-

Justice M. T. Joshi Judicial Member 17.09.2019 Prepared & Compared By: PK