2023 (11) TMI 65

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....led Appeal no. 452 of 2022 against the order dated May 26, 2022 of the Adjudicating Officer ('AO' for short) of the Securities and Exchange Board of India ('SEBI' for short) imposing a penalty of Rs. 10,00,000/- under Section 15HA and 15A(a) of SEBI Act, 1992. The appellant has also filed Appeal no. 453 of 2022 challenging the order of the Whole Time Member ('WTM' for short) dated October 22, 2021 debarring the appellant from accessing the securities market for 2 years. Since the issue is common and arises from a common dispute, both the appeals are being decided together. 2. The facts leading to the filing of the present appeal is, that the Board of Directors of the Company known as Southern Ispat and Energy Ltd. (SIEL) passsed a resoluti....

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....ant to the resolution of the Board of Directors not only a bank account was opened with EURAM Bank but the Managing Director executed a pledge agreement on behalf of the Company based on which a loan agreement was executed between Vintage and EURAM Bank in which the proceeds of the GDR was to be kept as security with EURAM Bank. The show cause notice further alleged that the pledge agreement and the loan agreement was not disclosed to the stock exchange and, consequently, the investors and shareholders were kept in the dark. The show cause notice further alleged that based on the pledge agreement and the loan agreement EURAM Bank advanced USD 29.98 million to Vintage which amount was utilised by Vintage to subscribe to the entire issue. The....

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....d Regulations 3 and 4 of the PFUTP Regulations. 8. The WTM and the AO found that the non-disclosure of the loan agreement and the pledge agreement was violative of Clause 36 of the Listing Agreement as well as Section 21 of the SCRA Act read with Clause 32 and 50 of the Listing Agreement. The WTM by its order debarred various entities for specified periods and directed the Company to bring back the GDR proceeds. The AO, on the other hand, imposed penalties for the same violation. 9. We have heard Shri Kunal Katariya, the learned counsel with Shri Anil Shah and Ms. Shrishti Shashi, the learned counsel for the appellant and Shri Sumit Rai, the learned counsel Ms. Nidhi Singh, Ms. Deepti Mohan, Shri Nishin Shrikhande and Ms. Hubab Sayeed, th....

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....SEBI and other companion appeals decided on June 27, 2022 and Appeal no. 28 of 2022, Praveen Kumar Hastimal Shah vs SEBI and other companion appeals decided on July 6, 2022. 12. The contention of the appellant is, that he was appointed as non-executive independent director on April 23, 2007 and had resigned on February 7, 2012. The appellant specifically contended that he was not involved in the day to day affairs of the Company and was also not aware that Vintage was the sole subscriber to the GDR or that there was a loan agreement or pledge agreement executed by the Company or the loan agreement executed between the bank and Vintage. 13. In this regard the WTM and the AO while admitting that the appellant was a non-executive independent....