Securities Appellate Tribunal
Ecl Finance Limited vs Sebi on 29 February, 2012
BEFORE THE SECURITIES APPELLATE TRIBUNAL
MUMBAI
Appeal No. 13 of 2012
Date of Decision : 29.02.2012
ECL Finance Limited
Edelweiss House,
Off. CST Road, Kalina,
Mumbai - 400 098. ...Appellant
Versus
1.Securities and Exchange Board of India, SEBI Bhavan, Plot No. C-4A, G-Block, Bandra-Kurla Complex, Bandra (East), Mumbai - 400 051.
2. Mentor Capital Limited 713, Raheja Centre, Free Press Journal Marg, Nariman Point Mumbai - 400 021. ...Respondents Mr. Somasekhar Sundaresan, Advocate with Mr. Paras Parekh, Advocate for the Appellant.
Mr. Shiraz Rustomjee, Senior Advocate with Ms. Harshada Nagare, Advocate for Respondent no.1.
Mr. P.N. Modi, Advocate with Mr. Neville Lashkari, Advocate for Respondent no. 2. CORAM : P.K. Malhotra, Member S.S.N. Moorthy, Member Per : P.K. Malhotra, Member (Oral) After hearing the learned counsel for the appellant and learned senior counsel for the respondent Board, we are of the view that this appeal can be disposed of in terms of the order passed by this Tribunal in Appeal no. 186 of 2011 (Aditya Birla Finance Ltd. vs. Securities and Exchange Board of India & Anr.) decided on November 2, 2011.
3. Learned senior counsel for the Board reiterates the stand taken by him in Aditya Birla case that the amount should not be allowed to be realized since a valid pledge has not been created. Learned counsel for the appellant disputes the same 2 stating that there is indeed a securities interest created in terms of clause 3.2 of the master loan agreement dated August 5, 2009. We do not think it necessary to deal with this issue afresh as it already stands covered by para 6 of our order in Aditya Birla case. Following our earlier order, we set aside the impugned order and issue the following directions:-
(i) The demat account of respondent no. 2 with the designated/approved depository participant shall be unfrozen for the limited purpose of transfer of shares to the demat account of the appellant.
(ii) The appellant shall be at liberty to sell the shares to the extent necessary to recover its outstanding dues. The shares, if any, that remain after recovering its dues shall be retransferred by the appellant to the demat account of respondent no. 2. The appellant is directed to inform the Board and respondent no. 2 soon after the sales are made and shall also furnish to them copies of the contract notes. The details of the loan adjustment shall also be furnished to them.
(iii) The appellant undertakes that in the event it is called upon by the Board or by this Tribunal to bring back the money which it would have realized by the sale of shares, it shall do so forthwith. The undertaking is recorded. It is, however, made clear that if and when the appellant is called upon to bring back the money, it shall be open to it to challenge the said direction and avail such remedies as are available in accordance with law.
In the result, the appeal is allowed as above with no order as to costs.
Sd/-
P.K. Malhotra Member Sd/-
S.S.N. Moorthy Member 29.02.2012 Prepared and compared by:
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