Satish Kumar Dhawan vs Sebi

DATE : 04.11.2016

Misc. Application No. 117 of 2016 And Appeal No. 163 of 2016

Satish Kumar Dhawan 4663, Gali Paswan Charkhewalan, Delhi - 110006. ..... Appellant

Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No. C-4A, G Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ...... Respondent

Dr. Prabhat Kumar, Advocate for the Appellant. Mr. Vikram Nankani, Senior Advocate with Mr. Anubhav Ghosh, Advocate i/b The Law Point for the Respondent.

CORAM : Justice J. P. Devadhar, Presiding Officer Jog Singh, Member Dr. C. K. G. Nair, Member

Per : Justice J. P. Devadhar (Oral)

1.

Appellant is aggrieved by the confirmatory order passed by the

Whole Time Member ("WTM" for short) of Securities and Exchange Board

of India ("SEBI" for short) on February 17, 2016 whereby the ex-parte ad-

interim order passed against various entities including the appellant on June

29, 2015 has been confirmed. By the ex-parte ad-interim order dated June

29, 2015 the WTM of SEBI, pending further investigation had restrained

several entities including the appellant from accessing the securities market

directly or indirectly in any manner until further orders.

2. Basic grievance of the appellant is that before passing the

confirmatory order, no opportunity of hearing was given to the appellant. It 2

is further contended on behalf of the appellant that in the absence of any

evidence to show that the appellant had any connection with the promoters

or directors of the target company, the appellant could not be said to have

violated any of the provisions of the securities laws.

3. We see no merit in the above contention.

4. In the ex-parte ad-interim order dated June 29, 2015, it was

specifically stated that the various entities named therein including the

appellant could file objections, if any, within 21 days from the date of

receipt of the ex-parte ad-interim order and indicate whether the said

entities want to avail any opportunity of personal hearing. Admittedly, the

appellant had not filed any objections within the stipulated time. Since the

appellant, even after lapse of more than seven months had not deemed it fit

to file any objections to the ex-parte ad-interim order the WTM of SEBI

had passed the confirmatory order on February 17, 2016. In such a case, no

fault can be found with the confirmatory order dated February 17, 2016.

5. Counsel for SEBI fairly states that even now if the appellant files

objections to the ex-parte ad-interim order, the WTM of SEBI would

consider the same and pass appropriate order thereon as expeditiously as

possible.

6. In these circumstances, without going into the merits of the case, by

consent, the appeal is disposed of in the following terms :

a) By consent, the confirmatory order passed on February 17, 2016

is quashed qua the appellant. However, it is made clear that the

ex-parte ad-interim order passed against the appellant on June

29, 2015 shall continue to operate.

3

b) Appellant is at liberty to file objections, if any, within two

weeks from today for continuation of the ex-parte ad-interim

order qua the appellant.

c) Within four weeks from the date of the receipt of such

objections, if any, from the appellant, the WTM of SEBI shall

grant an opportunity of hearing to the appellant and thereafter

pass appropriate order thereon as expeditiously as possible.

7. Appeal and the miscellaneous application are disposed of in the

aforesaid terms with no order as to costs.

Sd/-

Justice J. P. Devadhar Presiding Officer

Sd/-

Jog Singh Member

Sd/-

Dr. C. K. G. Nair Member 04.11.2016 Prepared & Compared by PTM