Shri Vasudev Ramchandra Kamat vs Sebi

Date of decision: 08/03/2016

Appeal No.270 of 2015

Shri Vasudev Ramchandra Kamat Flat No.14, 6th Floor, Dhanvantari Bldg -2, J.J. Hospital Campus Byculla, Mumbai - 400 008. ...Appellant

Versus

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

WITH Appeal No.310 of 2015

M/s Rajnandi Yarns Pvt. Ltd. Swiss Celina, Halia Bhatia, Mahajan Wadi, Shop No.9, Kolbhat Lane, Mumbai - 400 002. ...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. S.K. Jain, PCS for Appellants.

Mr. Kumar Desai a/w Mr. Mihir Mody, Mr. Harekrishna Ashar, and Mr. Saurabh Bachhawat, Advocates i/b K. Ashar & Co. for the Respondent. -2-

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

Per : Justice J.P. Devadhar (Oral)

1.

Appellants in these two Appeals are aggrieved by the common order

passed by the Adjudicating Officer (AO, for short) of Securities and Exchange

Board of India (SEBI, for short), dated 22nd December, 2014 whereby, apart

from others, penalty of Rs.5 lakh is imposed on each of the Appellants under

Section 15HA of the Securities and Exchange Board of India Act, 1992 for the

alleged violation of regulation 3(a), (b), (c), (d), 4(1) and 4(2)(a), (b), & (g) of

the Securities and Exchange Board of India (Prohibition of Fraudulent and

Unfair Trade Practices relating to Securities Market) Regulations, 2003 .

2. In the impugned order it is stated that the Appellant in Appeal No.270

of 2015 is connected with the Noticee at Sr.No.5 i.e. Bharat S Thakker and

Noticee at Sr.No.12 i.e. Bhavesh Pabari on account of having common

address. However, on perusal of the show-cause notice at page 85, it is seen

that the address of the Appellant is different from that of the Noticee No.5

and Noticee No.12. Counsel for SEBI, however, submitted that there could be

common address in the KYC records. Since the impugned order does not

refer to any KYC record and since the address given in the show-cause notice

contradicts the findings recorded in the impugned order, we deem it proper

to quash and set aside the impugned order and restore the Appeal No.270 of

2015 to the file of A.O. of SEBI for fresh decision on merits and in accordance

with law. In Appeal No.310 of 2015, the Appellant-company is held liable

because two of its Directors viz. Bhavesh Pabari and Hemant M. Sheth are

Directors of the Appellants. In view of the judgment of Apex Court in the

case of SEBI vs. Roofit Industries Ltd., reported in (2016) 194 Comp. Cas.186 -3-

(S.C.), we deem it proper to quash and set aside the impugned order qua the

Appellant in Appeal No.310 of 2015 and restore the matter to the file of A.O.

of SEBI for fresh decision on merits and in accordance with law.

3. In these circumstances, the impugned orders are quashed and set aside

qua the Appellants herein and the matters restored to the file of the AO of

SEBI for fresh decision on merits and in accordance with law. We hope that

on remand, SEBI would entrust the matters to some responsible officer who

would apply his mind and dispose of the matters by passing order in

accordance with law.

4. Both these Appeals are disposed of in the above terms with no order as

to costs.

Sd/-

Justice J.P. Devadhar Presiding Officer

Sd/-

Jog Singh Member 08/03/2016 Prepared & compared by-ddg