Securities Appellate Tribunal
Mr. Dushyant N. Dalal And Another vs Sebi on 17 January, 2014
Author: J. P. Devadhar
Bench: J. P. Devadhar
BEFORE THE SECURITIES APPELLATE TRIBUNAL
MUMBAI
Appeal No. 199 of 2013
Date of decision: 17.01.2014
Mr. Dushyant N. Dalal
Mrs. Puloma D. Dalal
4A Chandan, 62B Peddar Road
(Dr. Gopalrao Deshmukh Marg)
Mumbai - 400 026. ..... Appellants
Versus
Securities and Exchange Board of India
SEBI Bhavan, Plot No. C-4A, G Block,
Bandra Kurla Complex, Bandra (East),
Mumbai - 400 051. ...... Respondent
Mr. Darius Khambatta, Senior Advocate with Mr. Ravichandra S. Hegde, Advocate for the Appellants.
Mr. Shiraz Rustomjee, Senior Advocate with Mr. Mihir Mody, Advocate for the Respondent.
CORAM : Justice J. P. Devadhar, Presiding Officer Jog Singh, Member A. S. Lamba, Member Per : Justice J. P. Devadhar (Oral) This appeal is basically filed to challenge SEBI's order dated October 29, 2013 whereby various bank accounts of appellants have been attached to recover amounts due under disgorgement order dated July 21, 2009. By disgorgement order dated July 21, 2009, appellants were called upon to disgorge unlawful gain of ` 4.05 crore with simple interest thereon at the rate of 12% for four years (2005-2009) on 2 unlawful gains amounting to ` 1.95 crore within 45 days from July 21, 2009.
2. Admittedly, appeal filed by appellants against above disgorgement order has been dismissed by this Tribunal on November 12, 2010. Further appeal filed by appellants is admittedly dismissed by Apex Court on February 21, 2011 and even Review application filed by appellants before Apex Court has also been dismissed on August 24, 2011.
3. Since appellants have failed to comply with disgorgement order even after the said order attained finality, SEBI on October 29, 2013 has attached various bank accounts of the appellants in implementation of disgorgement order dated July 21, 2009.
4. By interim order dated December 6, 2013, this Tribunal lifted attachment on three bank accounts of the appellants subject to conditions set out therein. Both parties agree that during pendency of present appeal, appellants have paid ` 6 crore to the respondent. Question now to be considered is, whether appellants are liable to pay interest on disgorgement amount till ` 6 crore is paid by appellants.
5. Admittedly, by a demand notice dated December 12, 2013, SEBI called upon the appellants to pay ` 2,13,30,000/- as interest on the disgorgement amount for the period from 2009 as more particularly set out therein. By their reply dated January 13, 2014, the appellants have denied their obligation to pay any amount to the respondent. 3
6. It appears that by a communication dated January 14, 2014, SEBI has confirmed the demand of ` 2,13,30,000/-.
7. Mr. Khambatta, learned senior counsel appearing on behalf of the appellants' states that appellants would like to file an appeal against communication dated January 16, 2014 on merits within a period of one week from today and that in that appeal they would not raise the plea that the said order has been passed without personal hearing to the appellants. He further submits that the demand under communication dated January 16, 2014 being crystallized at ` 2,13,30,000/- together with interest from December 13, 2013 to January 5, 2014 on ` 4.05 crore, it would be just and proper to continue attachment on any one account to secure aforesaid amount and lift attachment on other bank accounts. Accordingly, counsel for appellants submits that shares in joint demat account of appellants bearing no. 40333429 with Karvy Stock Broking Limited may be attached as that account would be sufficient to cover the aforesaid demands raised against appellants.
8. Counsel for respondent, though objects to lifting attachment levied on various bank accounts, he does not dispute that value of shares in Demat A/c no. 40333429 are sufficient to cover demands raised against appellants.
9. In these circumstances, since no prejudice is likely to be caused to respondent, we direct that shares in joint demat Account No. 40333429 of appellants shall stand attached forthwith and in lieu thereof 4 attachment levied on all other bank accounts of appellants shall stand raised forthwith.
10. Since appellants desire to file appeal against communication dated January 16, 2014, respondent shall not take coercive steps to enforce demand raised under above communication dated January 16, 2014 from the attached demat account no. 40333429 for a period of four weeks from today.
11. Counsel for appellant's further state that appellants would like to make an application to SEBI for lifting additional debarment imposed upon appellants for non compliance of the disgorgement order dated July 21, 2009 within the time specified therein. If such an application is made within a period of two weeks from today, SEBI shall consider the same and pass appropriate order within a period of six weeks thereafter.
Appeal is disposed of in above terms with no costs.
Sd/-
Justice J. P. Devadhar Presiding Officer Sd/-
Jog Singh Member Sd/-
A. S. Lamba Member 17.01.2014 Prepared & Compared by PTM