TaxTMI 
TaxTMI 
2023 (2) TMI 442
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.... 1. Admit. 2. The appeal by the Securities and Exchange Board of India ["SEBI"] under Section 15Z of the Securities and Exchange Board of India Act 1992 ["SEBI Act"] arises from a judgment dated 1 November 2022 of the Securities Appellate Tribunal ["Tribunal"]. 3. The Tribunal, while allowing the appeal by the respondent, set aside an order dated 22 March 2022 of the Whole Time Member ["WTM"] under Section 15HA of the SEBI Act by which a penalty of Rs Ten lakhs was imposed on the respondent for violating of Sections 68 and 77A of the Companies Act 1956 and Regulations 3(a), (b), (c), (d), 4(1), 4(2)(f), (k) and (r) of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to the Sec....
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....he provisions of Sections 68 and 77A of the Companies Act 1956 and of the provisions of the PFUTP Regulations together with cognate provisions of the SEBI Act. 7. In appeal, the order of the WTM has been set aside by the Tribunal on 1 November 2022. The findings which have been arrived at by the Tribunal are encapsulated in paragraphs 14 and 15 of the impugned order. The Tribunal has, during the course of its decision held that once the offer and the balance sheet were approved by the Board of Directors, the duty of the Company Secretary was "only to authenticate the contents indicated in the balance sheet and in the offer document". In other words, according to the Tribunal, the respondent was not required to enquire into the veracity o....
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....hey are signed on behalf of the Board and before they are submitted to the auditors for their report; (iv) The duty of authentication cannot be confined to merely a signature on the relevant statutory documents; (v) There was a patent failure on the part of the respondent since as a Company Secretary, it was his duty to duly certify statutory compliances; (vi) The Tribunal was not justified in absolving him on the ground that it was for the Board of Directors to ensure compliance; and (vii) The observation in paragraph 18 of the impugned order to the effect that the role of the Company Secretary is only confined to redressing the grievance of investors is plainly contrary to Regulation 19(3). 10. On th....
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....tes. Since the interpretation which has been placed by the Tribunal on the interpretation of 19(3) is contrary to the plain terms of Regulation 19(3), we set aside the impugned decision and remit the proceedings back to the Tribunal for consideration of the facts afresh in the light of the interpretation which has been placed above on the provisions of Regulation 19(3). 12. Mr Arvind Datar, senior counsel, has placed reliance on the prior decisions of the Tribunal in Mr Bhuwaneshwar Mishra Vs SEBI (decided on 31 July 2014 in Appeal No 7 of 2014) and Brooks Laboratories Limited & Ors Vs SEBI (decided on 21 March 2018 in Appeal No 266 of 2016). Mr Somasekhar Sundaresan, counsel appearing on behalf of the respondent has urged that these dec....