Jayant Agro-organics Limited Vs. Securities and Exchange Board of India - Court Judgment

Excerpt:
2. the appellant being aggrieved by the order of the respondent in imposing penalty of rs. 50,000/- for delay in complying with the regulation 6(2) and regulation 6(4) of the sebi (substantial acquisition of shares and takeover) regulations, 1997 has preferred this appeal.3. the brief facts of the case are that the appellant company's shares have been listed on the mumbai stock exchange and also on national stock exchange, mumbai. the sebi (substantial acquisition of shares and takeovers) regulations, 1997 came into force from 20/02/1997. the disclosures under regulations 6(2) and 6(4) of the sebi (substantial acquisition of shares and takeovers) regulations, 1997 were due on 20/05/1997 but were actually complied on 07/06/1997 and 27/05/1997 respectively. sebi issued show cause notice dated 24/07/2003 with respect to the delay as detailed below:s. no. regulation due date actual date delay if remarks of compliance of compliance any 3. 8(3) 12/10/2000 17/11/2000 35 days record date 13/09/2000 4. the appellant by its letter dated 23/08/2003 replied to the said show cause notice pleading for clemency and raised the following mitigating circumstances. a) initially, there was a slight delay to comply with the newly introduced regulations as certain intricacies involved therein were required to be got clarified. b) except the initial delay, further compliance was done within the prescribed period. there were no repetitive defaults; d) there was no wrongful gain to the company nor any loss to any investor on account of slight delay in compliance; e) there was absolutely no intention on the part of the appellant to avoid compliance with any regulation. as regards regulation 8(3), there was no delay, since the disclosure was required on the record date of the company for the purpose of declaration of dividend. the company did not declare a dividend and did not fix the record date on 13/09/2000 for the purpose of declaration of dividend but for the purpose of annual general meeting.5. taking into account the reasons given for the delay it would be appropriate to reduce the penalty from rs. 50,000/- to rs. 15,000/-.the order is modified accordingly. the appellant is directed to pay the amount to the respondent within 4 weeks from the date of receipt of this order. the appeal is disposed of accordingly.

Judgment:
2. The appellant being aggrieved by the order of the respondent in imposing penalty of Rs. 50,000/- for delay in complying with the Regulation 6(2) and Regulation 6(4) of the SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997 has preferred this appeal.

3. The brief facts of the case are that the appellant company's shares have been listed on the Mumbai Stock Exchange and also on National Stock Exchange, Mumbai. The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 came into force from 20/02/1997. The disclosures under Regulations 6(2) and 6(4) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 were due on 20/05/1997 but were actually complied on 07/06/1997 and 27/05/1997 respectively. SEBI issued show cause notice dated 24/07/2003 with respect to the delay as detailed below:S. No. Regulation Due date Actual date Delay if Remarks of compliance of compliance any 3.

8(3) 12/10/2000 17/11/2000 35 days Record date 13/09/2000 4. The appellant by its letter dated 23/08/2003 replied to the said show cause notice pleading for clemency and raised the following mitigating circumstances.

a) Initially, there was a slight delay to comply with the newly introduced Regulations as certain intricacies involved therein were required to be got clarified.

b) Except the initial delay, further compliance was done within the prescribed period. There were no repetitive defaults; d) There was no wrongful gain to the company nor any loss to any investor on account of slight delay in compliance; e) There was absolutely no intention on the part of the appellant to avoid compliance with any regulation. As regards Regulation 8(3), there was no delay, since the disclosure was required on the Record date of the Company for the purpose of declaration of dividend. The company did not declare a dividend and did not fix the Record Date on 13/09/2000 for the purpose of declaration of dividend but for the purpose of Annual General Meeting.

5. Taking into account the reasons given for the delay it would be appropriate to reduce the penalty from Rs. 50,000/- to Rs. 15,000/-.

The order is modified accordingly. The appellant is directed to pay the amount to the respondent within 4 weeks from the date of receipt of this order. The appeal is disposed of accordingly.