TaxTMI 
TaxTMI 
2021 (9) TMI 310
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....r is a resident of Hyderabad and a minority shareholder of the respondent No.2/company, holding 790 equity shares in D-MAT form, vide DP ID IN301151. (b) Respondent No.2 is a Public Limited Company listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) having a paid-up share capital of Rs. 97,67,61,310 (Rupees ninety seven crores sixty seven lakh sixty one thousand three hundred and ten only). The respondent No.2/company was engaged in the business of procurement of milk, manufacturing of milk products and distribution of the same and cattle feed. After sale of its dairy business, the respondent No.2/company is in the business of cattle feed and nutrition. (c) The Board of Directors of the respondent No.2/company decided to sell the shareholding of the company in its subsidiary company, namely Sunfresh Agro Industries Private Limited (SAIPL), to Tirumala Milk Products Private Limited (TMPPL), which is a wholly owned subsidiary of French Dairy Multinational Groupe Lactalis. A public disclosure dated 21.01.2019 was issued by the respondent No.2/company for conducting the said sale and its shareholding to its sister concern. (d) The ....
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....ic shareholders of the respondent No.2/company and voluntarily delist the equity shares of the respondent No.2/company from the BSE and the NSE. Thus, a delisting offer was made by them, giving an exit opportunity to the shareholders. In the meeting of the Board of Directors of the respondent No.2/company held on 10.09.2019, the delisting proposal was deliberated upon and a resolution was passed for appointment of a Private Limited Company to perform the necessary due diligence for the delisting proposal. The floor price of Rs. 63.77 per share was set by the Board of Directors for voluntary delisting of the shares. The resolution of the Board of Directors for voluntary delisting was duly approved by the shareholders on 16.10.2019. (h) Based on some news/information, the respondent No.1/SEBI sought the comments of BSE and NSE on the details of the distribution of the proceeds deposited by the respondent No.2/company in the escrow account, the proposed floor price and the delisting offer price of the respondent No.2/company and its plans to ensure that a fair exit price is given to the minority shareholders. At the end of November, 2019, dissatisfied with the response receiv....
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....ed by the respondent No.2/company to oversee and manage the funds received upon completion of the sale transaction of SAIPL to TMPPL. Vide letter dated 21.11.2019, the resignation of Mr. Anoop Krishna was communicated by the respondent No.2/company vide its public disclosure at BSE and NSE. (k) Stating that Mr. Anoop Krishna had been at the helm of affairs of the respondent No.2/company and was closely connected to its management and even to the promoters of the respondent No.2/company during the entire period of execution and the sale of SAIPL to TMPPL and the period during which a decision had been taken place to delist the respondent No.2/company, the writ petitioner raises a grievance about the existence of a bias and conflict of interest of GTB, appointed by the respondent No.1/SEBI to act as a forensic auditor in respect of the respondent No.2/company, when one of its own directors is a close affiliate who is presently engaged with GT Restructuring Services LLP, a sister concern of GTB. 3. On receiving a letter dated 27.09.2020 from the respondent No.2/company regarding the non-independence of GTB as a forensic auditor, respondent No.1/SEBI sought comments from GT....
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....gulatory, professional and contractual obligations of the Firm or on the services provided to its clients. The ethical dividers and processes include: (a) Completely separate teams for the forensic engagement and other engagements. (b) No sharing of client's information or data between the different functions. (c) No communications between members of the different functions on details of the engagements or on relevant matters related to the engagements. (d) Specific undertakings from team members confirming their awareness of the requirements and acknowledging their contractual obligation to comply. (e) Appropriate and adequate monitoring of compliance. v. Thus, having regard to the above stated safeguards in place, our assessment of this matter is that there is no actual or potential threat (including the Self Review threat and Familiarity threat) to our independence or objectivity in the forensics audit of Prabhat Dairy Limited." 4. The respondent No.2/company challenged the order dated 20.10.2020 passed by the respondent No.1/SEBI before the Securities Appellate Tribunal (SAT) which was quashed and set aside vide order dat....
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.... Please note this is an auto-generated e-mail and may not be replied to. With regards, Office of Investor Assistance and Education SEBI" (emphasis added) 6. The petitioner replied to the above e-mail dated 09.03.2021, on 19.03.2021, stating inter alia that his grievance is against the respondent No.1/SEBI and not against the respondent No.2/company or any Market Infrastructure Institution which would require him to file a complaint on the 'SCORES PLATFORM'. When the respondent No.1/SEBI did not deal with the issues flagged by the petitioner, he filed the present petition on 23.03.2021. 7. Advancing arguments on behalf of the petitioner, Mr. S.Ravi, learned Senior Counsel has urged that appointment of GTB as a forensic auditor by the respondent No.1/SEBI has been without any application of mind, in complete disregard of the rules against bias and in contravention of the principles of professional ethics and rules regarding conflict of interest; that the said order violates the rights of the petitioner as a minority shareholder of the respondent No.2/company and the forensic audit process adopted in respect of the respondent No.2/company is l....
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....us vitiating the entire audit process. 9. A counter affidavit in opposition of the writ petition has been filed by the respondent No.1/SEBI. In its counter affidavit, the respondent No.1/SEBI has justified its stand of continuing with the appointment of GTB as a forensic auditor in respect of the respondent No.2/company for which it has relied on the e-mail dated 30.09.2020, received from the GTB, clarifying the role of Mr. Anoop Krishna. Based on the response of GTB, it has been stated that Mr. Anoop Krishna is not in a position of authority or responsibility to influence the engagement of GTB as a forensic auditor of the respondent No.2/company and that there are strict "ethical dividers within the firm that ensures that there is no impact on the independence on the contractual obligations of GTB on the services provided to its clients". It has further been stated on behalf of the respondent No.1/SEBI that after examination of the complaint regarding the allegations of conflict of interest, it was concluded that there was no such conflict of interest in the matter. 10. Mr. Arvind Datar, learned Senior Advocate appearing for the respondent No.1/SEBI has argued that the writ ....
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.... the order dated 09.11.2020 passed by the SAT, it would show that the order would be in respect of nine terms of reference and the GTB would continue as a forensic auditor of the respondent No.2/company. 12. It was next contended by learned counsel for the respondent No.1/SEBI that the petitioner's conduct is suspect, as he had been tracking the affairs of the respondent No.2/company since January, 2019 but did not make any complaint to SEBI till 09.03.2021. Even when he was requested to file a complaint in the prescribed format in "SCORES" (an online complaint filing system of SEBI), he did not follow the said procedure; that he has suppressed the fact that his registered address with NSDL is in Pune and his KYC was in Ahmednagar. Despite that, he has filed the present petition in this court on a plea that he had shifted his work place and residence to Hyderabad, State of Telangana, which cannot be a ground for creating a jurisdiction in this court. Lastly, it was canvassed that no rights of the petitioner have been violated. He has only 790 shares of the respondent No.2/company that has over 20,000 shareholders and his only right as a shareholder are the right to dividend, rig....
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....ity, which were forwarded to the respondent No.1/SEBI for its perusal on 28.11.2020; that the respondent No.2/company had also sought expert legal advice from a former Judicial Member of SAT and had forwarded the same to the respondent No.1/SEBI, wherein, it was opined that in view of the presence of Mr. Anoop Krishna on the Board of the Group of GTB, it would be appropriate if the forensic audit is conducted by any other audit firm of equal stature. 15. Ms. Rishika Harish, learned counsel for the respondent No.2/company submitted that the company is a public limited listed company and it is amenable to the jurisdiction of the respondent No.1/SEBI and is honouring the directions issued regarding delisting and the forensic audit and that the company has no role to play in the appointment of GTB as a forensic auditor. It was clarified that learned Senior Counsel appearing for the respondent No.1/SEBI had stated that in the appeal preferred by the respondent No.2/company before the SAT, a plea was taken in ground (s) questioning the appointment of GTB, but the company elected not to challenge the order passed by the SEBI holding that GTB ought to continue as a forensic auditor befo....
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....rt was on the scope of the forensic audit, as determined by the respondent No.1/SEBI. The aspect of any bias on the part of the forensic auditor appointed by the respondent No.1/SEBI, was not raised before the Supreme Court at all. Therefore, even the concept of constructive res judicata would not come into play in the instant case. In fact, the point of independence of GTB was neither urged before the SAT or before the Supreme Court. 18. On the objection taken by the respondent No.2/company that the appointment of GTB on 13.07.2020, was a statutory appointment, it was urged on behalf of the petitioner that the appointment order does not refer to any provision under which the GTB was appointed as a forensic auditor and therefore, it cannot be treated as a quasi judicial order for the petitioner to have preferred an appeal before the statutory authority, namely SAT. Learned Senior Advocate asserted that no grievance could have been registered by the petitioner against the acts of the respondent No.1/SEBI, on the SCORES platform which would be apparent from a perusal of FAQs published by the respondent No.1/SEBI in respect of complaints that are lodged on the SCORES platform. Last....
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....ight to the judgment of the court." 22. In Halsbury's Laws of England (4th Edn.), it has been stated that ""Cause of action" has been defined as meaning simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person. The phrase has been held from earliest time to include every fact which is material to be proved to entitle the plaintiff to succeed, and every fact which a defendant would have a right to traverse. "Cause of action" has also been taken to mean that particular act on the part of the defendant which gives the plaintiff his cause of complaint, or the subject-matter of grievance founding the action, not merely the technical cause of action." 23. As can be seen from the above, "cause of action" is a bundle of facts which when taken together, with the law applicable to the said facts, gives a right to the plaintiff to seek relief against the defendant. In other words, cause of action is premised on the existence of a group of facts put together that would entitle a plaintiff to approach the court for a remedy against the defendant. 24. In ONGC v. Utpal Kumar Basu, reported as (1994) 4 SCC 711, referrin....
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....asks the Court to arrive at a conclusion in his favour." Therefore, in determining the objection of lack of territorial jurisdiction the court must take all the facts pleaded in support of the cause of action into consideration albeit without embarking upon an enquiry as to the correctness or otherwise of the said facts. In other words the question whether a High Court has territorial jurisdiction to entertain a writ petition must be answered on the basis of the averments made in the petition, the truth or otherwise whereof being immaterial. To put it differently, the question of territorial jurisdiction must be decided on the facts pleaded in the petition. Therefore, the question whether in the instant case the Calcutta High Court had jurisdiction to entertain and decide the writ petition in question even on the facts alleged must depend upon whether the averments made in paragraphs 5, 7, 18, 22, 26 and 43 are sufficient in law to establish that a part of the cause of action had arisen within the jurisdiction of the Calcutta High Court." (emphasis added) 25. In Navinchandra N. Majithia v. State of Maharashtra, reported as (2000) 7 SCC 640, keeping in mind the object....
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....ed in the writ petition and the prayers sought. 27. In Om Prakash Srivastava v. Union of India, reported as (2006) 6 SCC 207, the Supreme Court has observed in the same vein that a plain reading of clause (2) of Article 226 of the Constitution of India would make it clear that the High Court can exercise its power to issue any direction, order or writ for the enforcement of any fundamental right or for any other purpose if the cause of action wholly or in part had arisen within the territorial limits in relation to which the Court exercises jurisdiction, regardless of the fact that the seat of the Government or authority or the residence of the person against whom the direction/order/writ is issued, does not fall within the territorial jurisdiction of the said Court. We may usefully extract below; para 7 of the said ruling:- "7. The question whether or not cause of action wholly or in part for filing a writ petition has arisen within the territorial limits of any High Court has to be decided in the light of the nature and character of the proceedings under Article 226 of the Constitution. In order to maintain a writ petition, a writ petitioner has to establish that a le....
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....The Court stated: (Kusum Ingots case, SCC p. 261, para 20) "20. A distinction between a legislation and executive action should be borne in mind while determining the said question". Referring to ONGC v. Utpal Kumar Basu, (1994) 4 SCC 711 : JT (1994) 6 SC 1, it was held that all necessary facts must form an "integral part" of the cause of action. The fact which is neither material nor essential nor integral part of the cause of action would not constitute a part of cause of action within the meaning of Clause (2) of Article 226 of the Constitution. 36. In National Textile Corporation Ltd. V. Haribox Swalram, (2004) 9 SCC 786 : JT (2004) 4 SC 508, referring to earlier cases, this Court stated that: (SCC p. 797, para 12.1) "12.1 ...the mere fact that the writ petitioner carries on business at Calcutta or that the reply to the correspondence made by it was received at Calcutta is not an integral part of the cause of action and, therefore, the Calcutta High Court had no jurisdiction to entertain the writ petition and the view to the contrary taken by the Division Bench cannot be sustained." 37. From the aforesaid discussion and keeping in view the ratio laid ....
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....o see the convenience of all the parties before it. The convenience in its ambit and sweep would include the existence of more appropriate forum, expenses involved, the law relating to the lis, verification of certain facts which are necessitous for just adjudication of the controversy and such other ancillary aspects. The balance of convenience is also to be taken note of. Be it noted, the Apex Court has clearly stated in the cases of Kusum Ingots (supra), Mosaraf Hossain Khan (supra) and Ambica Industries (supra) about the applicability of the doctrine of forum conveniens while opining that arising of a part of cause of action would entitle the High Court to entertain the writ petition as maintainable. 32. The principle of forum conveniens in its ambit and sweep encapsulates the concept that a cause of action arising within the jurisdiction of the Court would not itself constitute to be the determining factor compelling the Court to entertain the matter. While exercising jurisdiction under Articles 226 and 227 of the Constitution of India, the Court cannot be totally oblivious of the concept of forum conveniens. The Full Bench in New India Assurance Co. Ltd. (supra) has ....
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....f action are required to be scrutinized by the High Court depending upon the factual matrix of each case in view of what has been stated in Ambica Industries (supra) and Adani Exports Ltd. (supra). (g) The conclusion of the earlier decision of the Full Bench in New India Assurance Company Limited (supra) "that since the original order merges into the appellate order, the place where the appellate authority is located is also forum conveniens" is not correct. (h) Any decision of this Court contrary to the conclusions enumerated hereinabove stands overruled." 32. On an understanding of the aforesaid rulings, there is no manner of doubt that the question as to whether cause of action has arisen wholly or in part, within the territorial limits of a High Court where a writ petition has been filed, would have to be decided keeping in view the nature and the characteristics of the proceedings filed. Even a fraction of a cause of action having arisen in the territorial jurisdiction of the court will vest jurisdiction on it. But that should be integral to the relief prayed for in the petition and not some extraneous or irrelevant averment, that has no nexus with the rem....
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....d by the respondent No.1/SEBI regarding lack of cause of action for filing the writ petition in this court, is turned down as devoid of merits. The principle of forum conveniens is also in favour of the petitioner who being a minority shareholder, cannot be expected to approach the High Court at Mumbai for relief merely because the registered offices of the respondents are situated in the State of Maharashtra. Even otherwise, no hardship has been caused to the respondents as they are not expected to produce any records for the perusal of the court, causing any inconvenience. The petition is being decided on the basis of the pleadings and arguments advanced by learned counsel. 35. The next objection taken by the respondent No.1/SEBI regarding non-joinder of GTB as a necessary party in the present proceedings would have been persuasive, had the clarification given by GTB not been extracted in the impugned order dated 20.10.2020 passed by the respondent No.1/SEBI. Having the benefit of the explanation offered by GTB to the respondent No.1/SEBI, this court is only required to examine the reasons that have weighed with the respondent No.1/SEBI for continuing with GTB as the forensic ....
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....cedures which are considered inherent in the exercise of a judicial power are merely those which facilitate if not ensure a just and fair decision. In recent years the concept of quasi-judicial power has been undergoing a radical change. What was considered as an administrative power some years back is now being considered as a quasi-judicial power. The following observations of Lord Parker C.J., in Regina v. Criminal Injuries Compensation Board Ex parte Lain [(1967) 2 QB 864 at p. 881] are instructive. "With regard to Mr Bridge's second point I cannot think that Atkin L.J., intended to confine his principle to cases in which the determination affected rights in the sense of enforceable rights. Indeed, in the Electricity Commissioners case the rights determined were at any rate not immediately enforceable rights since the scheme laid down by the commissioners had to be approved by the Minister of Transport and by resolutions of Parliament. The Commissioners nevertheless were held amenable to the jurisdiction of this court. Moreover, as can be seen from Rex v. Postmaster-General Ex parte Carmichael [(1928) 1 KB 291] and Rex v. Boycott Ex parte Kesslay [(1939) 2 KB 651] ....
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....er the Sugarcane (Control) Order, 1966, is a quasi-judicial power. With the increase of the power of the administrative bodies it has become necessary to provide guidelines for the just exercise of their power. To prevent the abuse of that power and to see that it does not become a new despotism, courts are gradually evolving the principles to be observed while exercising such powers. In matters like these, public good is not advanced by a rigid adherence to precedents. New problems call for new solutions. It is neither possible nor desirable to fix the limits of a quasi-judicial power. But for the purpose of the present case we shall assume that the power exercised by the selection board was an administrative power and test the validity of the impugned selections on that basis." (emphasis added) 38. Applying the above principles to the case on hand, it can be seen that the allegation of the petitioner is not of real bias, but the possibility of bias on the part of GTB qua the forensic audit that it has been directed to conduct in respect of the financial statements of the respondent No.2/company. The grievance raised is about a reasonable likelihood of bias and acceptance of....
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....res which are considered inherent in the exercise of a judicial power are merely those which facilitate if not ensure a just and fair decision. 13. What is thus important in the modern administration is the fairness of procedure with elimination of element of arbitrariness. The State functionaries must act fairly and reasonably. That is, however, not the same thing to state that they must act judicially or quasi-judicially. In Keshav Mills Co. Ltd. v. Union of India [(1973) 1 SCC 380 : (1973) 3 SCR 22] Mukherjea, J. said (SCC p. 387, para 8: SCR p. 30) "The administrative authority concerned should act fairly, impartially and reasonably. Where administrative officers are concerned, the duty is not so much to act judicially as to act fairly." 14. The procedural standards which are implied by the duty to act fairly has been explained by Lord Pearson in Pearlberg v. Varty [(1972) 1 WLR 534, 547 : (1972) 2 All ELR 6] : "A tribunal to whom judicial or quasi-judicial functions are entrusted is held to be required to apply those principles (i.e. the rules of natural justice) in performing those functions unless there is a provisions to the contrary. But....
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....tural justice, such statutory silence is taken to imply compliance with the principles of natural justice. The implication of natural justice being presumptive, it should be followed by the authorities unless it is excluded by express words of statute or by necessary implication. 18. Citations could be multiplied since there is fairly abundant case law which has come into existence : See, for example, E.P. Royappa v. State of Tamil Nadu [(1974) 4 SCC 3: 1974 SCC (L&S) 165: (1974) 2 SCR 348] and Union of India v. Tulsiram Patel [(1985) 3 SCC 398 : 1985 SCC (L&S) 672 : 1985 Supp 2 SCR 131] . More recently in a significant judgment in Charan Lal Sahu v. Union of India [(1990) 1 SCC 613: (1989) 4 JT 582] learned Chief Justice Sabyasachi Mukharji has referred to almost all the authorities of this Court on this aspect and emphasized that the principles of natural justice are fundamental in the constitutional set up of this country. No man or no man's right should be affected without an opportunity to ventilate his views. Justice is a psychological yearning, in which men seek acceptance of their viewpoint by having an opportunity before the forum or the authority enjoined or ....
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....ndependently produce proof of prejudice that may have been caused to him. 41. On the same lines, is the decision of the Supreme Court in Sahara India (Firm) v. Commissioner of Income Tax, reported as (2008) 14 SCC 151, where dealing with a case of special audit of the accounts of the appellant/assessee, a plea was raised that before any direction could be issued under Section 142 (2-A) of the Income Tax Act, it was necessary to afford an opportunity of hearing to the appellant, the Supreme Court answered the said question in the affirmative by reading the concept of natural justice into the special provision and holding thus:- "4. Before dealing with the rival submissions to determine whether the principles of natural justice demand that an opportunity of hearing should be afforded to an assessee before an order under Section 142(2-A) of the Act is made, we may appreciate the concept of "natural justice" and the principles governing its application. 15. Rules of "natural justice" are not embodied rules. The phrase "natural justice" is also not capable of a precise definition. The underlying principle of natural justice, evolved under the common law, is to check....
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....umstances of that case, the framework of the statute under which the enquiry is held. The old distinction between a judicial act and an administrative act has withered away. Even an administrative order which involves civil consequences must be consistent with the rules of natural justice. The expression 'civil consequences' encompasses infraction of not merely property or personal rights but of civil liberties, material deprivations and nonpecuniary damages. In its wide umbrella comes everything that affects a citizen in his civil life." 42. In paragraphs 19, 20 and 21 of the aforesaid decision, the Supreme Court has concluded that no general rule of universal application of the principles of "audi alteram partem" can be laid down and each case would have to be examined on its own facts and observed as follows:- "19. Thus, it is trite that unless a statutory provision either specifically or by necessary implication excludes the application of principles of natural justice, because in that event the court would not ignore the legislative mandate, the requirement of giving reasonable opportunity of being heard before an order is made, is generally read into the provision....
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.... relevant facts of the said case were that a collision had taken place between a motor vehicle belonging to the appellant and one belonging to W, resulting in summons being taken out by the police against the applicant for rash and negligent driving. At the hearing of the summons, the acting clerk of the Justices happened to be a member of the firm of Solicitors who were acting for W in a claim for damages filed by him against the applicant for injuries received by him in the collision. After the evidence was concluded and the Justices retired to the chambers to consider their decision, the acting clerk retired with them, while taking along with him, the notes of evidence, if so required and to advise them on any point of law. Upon conferring with each other, the Justices returned to the Court and declared that they had decided to convict the applicant. At that stage, the applicant's solicitor mentioned to the court that only after the hearing was over, was he apprised of the relationship of the deputy clerk with one of the partners of the firm of solicitors engaged by W, in the civil proceedings filed by him against the applicant and raised an objection as to the sanctity of the j....
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....with the justices; in other words, his one position was such that he could not, if he had been required to do so, discharge the duties which his other position involved. His twofold position was a manifest contradiction. In these circumstances, I am satisfied that this conviction must be quashed, unless it can be shown that the applicant or his solicitor was aware of the point that might be taken, refrained from taking it, and took his chance of an acquittal on the facts, and then, on a conviction being recorded, decided to take the point. On the facts, I am satisfied that there has been no waiver of the irregularity, and, that being so, the rule must be made absolute and the conviction quashed." (emphasis added) 46. In Manak Lal v. Dr. Prem Chand reported in AIR 1957 SC 425, where a committee was constituted to enquire into a complaint leveled against an Advocate and the Chairman of the said committee had once appeared as a counsel for the complainant, the Supreme Court held that constitution of such a committee was bad and observed as follows:- "4. xxx In such cases the test is not whether in fact a bias has affected the judgment; the test always is and mu....
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....s also the Chairman of the Transaction Committee constituted by the respondent No.2/ company to oversee and manage the funds received on completion of the sale transaction of SAIPL (subsidiary company of the respondent No.2/company) to TMPPL (subsidiary company of French Groupe). 48. It is also not in dispute that the sale proceeds of the shares of SAIPL to TMPPL, i.e., a sum of Rs. 1000-1200 crores had been placed in an escrow account held in trust for the shareholders and the very same Transaction Committee was required to deliberate upon and evaluate the various options available for distribution of the monies to the shareholders. As noted above, Mr. Anoop Krishna happened to be one of the members of the Transaction Committee constituted by the respondent No.2/ company. During the very same period, the two promoters of the respondent No.2/company who cumulatively held 50.10% of its total shareholding, decided to acquire the remaining 49.90% of the paid up equity capital held by public shareholders and thereafter, voluntarily delist the equity shares of the company from the BSE and NSE. It has not been denied by the respondent No.2/company that during this entire period when a....
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....ndent No.2/company for the years ending 31.03.2019 and 31.03.2020, along with an audit assignment containing nine terms of reference. Para 24 of the said order refers to the e-mails dated 09.09.2020 and 27.09.2020 received by the respondent No.1/SEBI from the shareholders of the respondent No.2/company, raising similar grievances as raised by the petitioner herein. After considering the reply/clarification dated 30.09.2020, submitted by GTB in its letter dated 07.10.2020, the respondent No.1/SEBI turned down the objection of there being a conflict of interest on the independence of the forensic auditor and declined the request made for a change of the forensic auditor. The petitioner having filed the present petition within six months from October, 2020, it cannot be stated that the same is highly belated. 51. On merits too, a perusal of the order dated 20.10.2020 reveals that it is bereft of any reasons for ratifying the decision taken by the respondent No.1/SEBI on 07.10.2020 and for negating the plea of the shareholders of the respondent No.2/company that there exists a conflict of interest on the independence of the forensic auditor due to the presence of Mr. Anoop Krishna o....
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....rt which was dismissed vide order dated 07.04.2021 in the following terms:- "In the peculiar facts and circumstances of these cases, we are not inclined to interfere with the order passed by the Securities Appellate Tribunal. We clarify that the forensic audit shall be conducted in respect of the nine terms of reference at para 17 of page 81 of the paper book." 54. The submission made on behalf of the respondent No.1/SEBI that the order dated 07.04.2021 passed by the Supreme Court ought to be treated as binding on all the parties including the petitioner herein not only in relation to continuation of the forensic audit but also in respect of the appointment of GTB as a forensic auditor, is wholly devoid of merits as the Supreme Court was not even called upon to examine the issue of objectivity and impartiality of GTB to act as a forensic auditor in respect of the financial affairs of the respondent No.2/company. No such plea was taken by any of the parties before the Supreme Court for it to have ruled either ways. 55. The question that needs to be examined is whether GTB, tasked with the role of a financial auditor, should be above suspicion, like Caesar's wife? This....
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....tself enumerated in the FAQs and guidelines uploaded on its website, several rights that are vested in a shareholder which include the right to receive an offer, in case of a takeover or a buyback under the SEBI Regulations. In the instant case, the respondent No.1/SEBI has itself taken note of the complaints received against the promoters of the respondent No.2/company alleging inter alia that they were trying to hoodwink the investors, by voluntarily deciding to delist from BSE and NSE and offering a pittance as the exit price, i.e., Rs. 63.77 ps. per share, which was otherwise listed in the stock market at Rs. 113/- in January, 2021 and was discounted at 20% vis-à-vis the earlier day's closing price. The allegations that are being examined by the respondent No.1/SEBI also relate to whether the exit price fixed by the promoters of the respondent No.2/company for buying back shares from the public shareholders has been depressed to cause them pecuniary loss. 57. Given the above background, we find merit in the submission made on behalf of the petitioner that what is involved in the present case is not the interest of the petitioner alone. The interest of all the minority....