Thapar Ispat Limited vs Sebi

Date of Decision: 4.4.2019

Misc. Application No.102 of 2017 And Appeal No.89 of 2017

Thapar Ispat Limited Dhandari Khurd, Focal Point, Phase-VII, Ludhiana (Punjab)-141010. .... Appellant

Versus

Securities and Exchange Board of India SEBI Bhawan, Plot No.C-4A, G Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400051. ... Respondent

Mr. Rakesh Puri, Advocate i/b. Mr. Devanshu Desai, for the Appellant.

Mr. Aditya Chitale, Advocate with Mr. Anubhav Ghosh and Ms. Vidhi Jhawar, Advocates i/b. The Law Point 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) 2

Misc. Application No.102 of 2017

There is a delay of 12 days in filing this appeal. Cause

shown is sufficient. The delay in filing the appeal is

condoned. The application is allowed.

Appeal No.89 of 2017

1.

The present appeal has been filed questioning the legality

and veracity of the order dated 28th April, 2015 passed by the

Adjudicating Officer of Securities and Exchange Board of

India (referred to hereinafter as 'SEBI') wherein penalty of

Rs.15 lakhs was imposed for not resolving the investors

grievances within a time specified therein.

2. The grievance of the appellant is that 46 of such

complaints were for the period prior to 2001 and records of

such complaints were not available on account of a fire

which broke out in the Company's office which resulted in

the destruction of records. Further, the Company had

become a sick industrial unit under the provisions of BIFR

since 2001 as a result on account of inadequate staff, the

complaints, if any, could not be redressed.

3. Having heard the learned counsel for the parties we

find that admittedly the appellant had taken the SCORES 3

registration in the year 2013. Section 15C of the Securities

and Exchange Board of India Act, 1992 (referred to

hereinafter as 'SEBI Act') required the Company to redress

the grievances of the investors within the time specified. A

circular dated 17th April, 2013 was issued indicating that

failure by Company to file action taken report under

SCORES within 30 days of the date of receipt of the

grievances may also attract the provisions of Section 15A(a)

of the SEBI Act.

4. We find that the Adjudicating Officer found that after

registration on the SCORES the appellant resolved 40 out of

46 complaints and six of these complaints still remained

pending on the SCORES database and on account of the

continuous default the penalty was imposed.

5. Having heard the learned counsel for the parties, we

find that all the pending complaints have been resolved

during the pendency of the appeal. Further, in view of the

fact that the appellant had become a sick company and the

complaints were of the period prior to 2001 we are of the

view that since the investor grievances has now been

redressed we deem it proper in the present circumstances of

the case to reduce the penalty.

4

6. For the reasons stated aforesaid and considering the fact

that the appellant has been undergoing financial constraint,

in the fact and given circumstances, we reduce the penalty

from Rs.15 lakh to Rs.5 lakh. The said amount shall be

deposited before the respondent within six weeks from today.

The appeal is partly allowed.

Sd/-

Justice Tarun Agarwala Presiding Officer

Sd/-

Dr. C. K. G. Nair Member

Sd/-

Justice M.T. Joshi Judicial Member

4.4.2019 Prepared and compared by RHN