Securities Appellate Tribunal
Kkdil Nidhi Ltd. & Ors. vs Sebi on 4 May, 2021
Author: Tarun Agarwala
Bench: Tarun Agarwala
BEFORE THE SECURITIES APPELLATE TRIBUNAL
MUMBAI
Date of Decision: 4.5.2021
Misc. Application No.567 of 2021
(Delay Application)
And
Appeal No.206 of 2021
1.KKDIL Nidhi Ltd.
C/o. Sujata Dash, Bank Colony, 8th Lane, Near Radio Station, Berhampur, Ganjam 760001.
2. Mrs. Sujata Dash C/o. Sujata Dash, Bank Colony, 8th Lane, Near Radio Station, Berhampur, Ganjam 760001.
3. Mr. Bipin Chandra Dash C/o. Sujata Dash, Bank Colony, 8th Lane, Near Radio Station, Berhampur, Ganjam 760001.
4. Mr. Santhosh Kumar Panda At Chandan Nagar, Po. Ankuli Berhampur, Ganjam Dist.
Odhisha - 760010.
5. Mr. Hara Prasad Das Gauradeipur, G.P- Kodala, Dist -
Ganjam Odhisha - 761032. ...Appellants Versus Securities and Exchange Board of India SEBI Bhavan, Plot No.C4-A, 2 'G' Block, Bandra-Kurla Complex, Bandra (East), Mumbai-400051. ...Respondent Mr. Ramesh Chandra Mishra, PCS with Mr. Lokanath Mishra, Advocate for the Appellant. Mr. Anubhav Ghosh, Advocate with Mr. Ravishekhar Pandey, Advocate i/b. The Law Point for the Respondent.
CORAM: Justice Tarun Agarwala, Presiding Officer Justice M.T. Joshi, Judicial Member Per: Justice Tarun Agarwala, Presiding Officer (Oral)
1. The present appeal has been filed against the order dated 28th October, 2016 issued by the Whole Time Member ('WTM' for short) directing the appellants to refund the amount collected through the issuance of equity shares. The appellants were also restrained from accessing the securities market. The appellants have also challenged the order of the attachment dated 29th December, 2020 which was issued pursuant to the impugned order dated 28th October, 2016. 3
2. There is a delay of 1508 days in the filing of the appeal and, accordingly, an application for condonation of delay has been filed. The ground urged is that the husband of appellant no.2 Mr. Baman Chandra Dash was the main person behind the incorporation of the Company and was whole and sole incharge. Appellant no.2 was only a homemaker and appellant no.3 is the father in law of appellant no.2 and is an aged person and had nothing to do with the day to day affairs in the running of the Company. It was contended that appellant nos.2 and 3 alongwith appellant nos.4 and 5 were made Directors in the Company but had no role to play. It was also contended that the respondent issued an ex-parte ad- interim order dated 25th March, 2015 pursuant to which the appellants requested for an opportunity to be heard at Bhubaneswar in Orissa and, thereafter, the confirmatory order dated 28th October 2016 was passed. Since no compliance was made the attachment 4 order was passed. It was contented that the appellant no.2's husband was the main person who was incharge of the affairs of the Company and unfortunately died on 9th February, 2018 under mysterious circumstances. In such circumstances, the appellants have prayed that the delay is not deliberate but on account of the aforesaid circumstances the delay may be condoned and the matter may be heard on merits.
3. On the other hand, the learned counsel for the respondent contended that he has the requisite proof which he can file, namely, that the notices were duly served upon the appellants, the acknowledgement due cards are proof of this fact. Apart from the aforesaid, publications were made in the newspapers and the appellants appeared and filed their replies and participated in the proceedings. It was contended that no sufficient cause has been shown and, therefore, the application for condonation of delay should be rejected.
5
4. Having heard the learned counsel for the parties we find that there is an inordinate delay in the filing of the appeal. No sufficient cause has been shown to condone the delay. The appellants were aware of the order and participated in the proceedings but took no steps to challenge the order after the impugned order was passed. The fact that the appellants were unaware of the proceedings is an afterthought and cannot be believed. The fact that the appellant no.2's husband was whole and sole person who was in charge cannot be relied upon. The appellants were Directors and had a responsible role to play and they cannot shy away from the fact that they were unaware of the day to day affairs of the Company.
5. We are of the opinion that the reasons given are not bonafide and, in any case, sufficient cause has not been shown.
6. In Basawaraj and Anr. vs. Special Land Acquisition Officer, (2013) 14 SCC 81 the Supreme 6 Court held that the discretion to condone the delay has to be exercised judicially based on facts and circumstances of each case and that sufficient cause cannot be given a liberal interpretation if lack of bonafide is attributed to a party. The Supreme Court further held that delay cannot be condoned on equitable ground beyond the limits permitted expressly by statute.
7. The Supreme Court in Ram Nath Sao and Ors.
(supra) held that the expression "sufficient cause"
should receive a liberal construction so as to advance substantial justice when no negligence or inaction or want of bonafide is imputable to a party. The same view was reiterated by the Supreme Court in Madanlal vs. Shyamlal, (2002) 1 SCC 535.
8. In Balwant Singh (Dead) vs Jagdish Singh & Ors, (2010) 8 SCC 685 Supreme Court held that the expression "sufficient cause" means the presence of legal and adequate reasons. The decisions cited by the 7 learned counsel for the appellant are of no avail and, in any case, not applicable in the present circumstance of the case.
9. This Tribunal is possessed with the exercise of judicial discretion in condoning the delay if sufficient or adequate reason is given. It is also a settled proposition of law that the law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes. The court has no power to extend the period of limitation on equitable grounds as held by the Supreme Court in Basawaraj and Anr.(supra). In the instant case we do find any legal or adequate reasons to condone the delay.
10. In the light of the aforesaid, the learned counsel for the appellant referred to the case of Collector, Land Acquisition vs. Mst. Katiji and Ors. MANU/SC/0460/ 1987 which is distinguishable and is not applicable. In the said case Supreme Court was considering the 8 impersonal machinery of the State Government. The bureaucratic red tapism in pushing the files and passing the buck to others and in that scenario held that 'sufficient cause' is adequately elastic to enable the courts to apply the law in a meaningful manner which subserve the ends of justice. The said decision is, however, not applicable in the instant case.
11. For the reasons stated aforesaid, we do not find any sufficient cause being shown for condoning the inordinate delay of 1508 days in filing the appeal. The application is rejected as a result of which the appeal is also dismissed.
12. The present matter was heard through video conference due to Covid-19 pandemic. At this stage it is not possible to sign a copy of this order nor a certified copy of this order could be issued by the registry. In these circumstances, this order will be digitally signed by the Private Secretary on behalf of the bench and all concerned parties are directed to act 9 on the digitally signed copy of this order. Parties will act on production of a digitally signed copy sent by fax and/or email.
Justice Tarun Agarwala Presiding Officer Justice M.T. Joshi Judicial Member Digitally signed RAJALA byRAJALAKSHMI H 4.5.2021 KSHMI NAIR Date:
RHN H NAIR 2021.05.12
16:34:57 +05'30'