TaxTMI 
TaxTMI 
2021 (8) TMI 1397
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.... Act, amounting to Rs. 40 lacs, the present appeal is filed by two noticees i.e. Appellant no. 1 Dr. V K Sukumaran and Appellant no. 2 Ms. Saritha Sukumaran. 2. The proceedings were initiated by respondent SEBI against seven noticees. The present appellants during the relevant period were the promoters of VKS Project Limited (hereinafter referred to as 'the Company'). The respondent SEBI found irregularities in the scrip of the Company during the period from July 18, 2012 to December 31, 2014. It was found that the present appellants along with noticee no. 3 (Mr. R. Sahadevan - alleged promoter exonerated vide same impugned order having found that he was not the promoter) had acquired more than 5% paid up share capital of the Company in the financial year 2013-14 and therefore they were required to make an announcement of open offer in accordance with the Regulation 3(2) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (hereinafter referred to as 'SAST Regulations 2011). However, it was found by SEBI that these noticees have failed to do so. During the proceedings, as detailed above, it was found that Mr. R. Sahadevan was not the promoter of the Company ....
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....ary Accounts of Mr. Piyush Kothari in off market transactions. Further, on October 8, 2013 Appellant no. 1 had transferred 1.50 crore shares to noticee no. 6 Mr. Mehul Jagdishbhai Mody as security for financial assistance offered by the said noticee Mr. Mody. However, none of these noticees were able to provide financial assistance though the shares were transferred to their accounts as security. In the circumstances, Mr. Piyush Kothari, noticee no. 4, returned the said 3 crores shares to the beneficiary account of Appellant no. 1 from his two Beneficiary Accounts (1.50 crores shares each). Another noticee no. 6 Mr. Mehul Mody did not return the shares but after great deal of persuasion and perseverance, he returned only 52,94,005 shares between November 23 to 29, 2013. The said noticee (Mr. Modi) informed that that he had transferred some of the shares off market to several persons. 25 lakhs shares were transferred by him to noticee no. 7 Mr. Nilesh Devendra Vora. After persuasion the said noticee transferred those 25 lakhs shares to the Beneficiary Account of Appellant no. 2 on November 22, 2013. Rest of the shares however could not be recovered and therefore appellants had filed....
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.... OnLine Bom 1134 and (ii) Liquid Holdings Private Limited vs Securities and Exchange Board of India (Appeal No. 83 of 2010 decided on March 11, 2011). 9. In the case of JRY Investments Private Limited (supra) it was contended by the plaintiff therein that shares were transferred to the defendant No. 1 therein with the intention of creating security only. There was no intention of transferring the shares to defendant no. 1 therein. It was therefore submitted that the defendant no. 1 has no right to transfer the shares in favour of the rest of the defendants therein. The Bombay High Court in paragraph 31 noted that the plaintiff therein did not make any application to the depository for the creation of a pledge as contemplated by regulation 58 of the Securities and Exchange Board of India (Depositories and Participants) Regulations 1996 (hereinafter referred to as 'Depository Regulation'). The shares were undisputedly transferred in favour of defendant no. 1 and the shares were held with the depository herein was shown as the beneficial owner of the shares. The Bombay High Court therefore held that the plaintiff had conveyed their property in the shares to defendant no. 1. and the t....
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....edger. (8) Subject to the provisions of the plegde document, the pledgee may invoke the pledge and on such invocation, the depository shall register the pledgee as beneficial owner of such securities and amend its records accordingly. (9) After amending its records under sub-regulation (8) the depository shall immediately inform the participants of the pledger and pledgee of the change who in turn shall make the necessary changes in their records and inform the pledger and pledgee respectively. (10) (a) If a beneficial owner intends to create a hypothecation on a security owned by him he may do so in accordance with the provisions of sub-regulations (1) to (9). (b) The provisions of sub-regulations (1) to (9) shall mutatis mutandis apply in such cases of hypothecation: Provided that the depository before registering the hypothecatee as a beneficial owner shall obtain the prior concurrence of the hypothecator. (11) No transfer of security in respect of which a notice or entry of pledge or hypothecation is in force shall be effected by a participant without the concurrence of the pledgee or the hypothecatee as the case may be." 11. It was also noted that as per Section 1....