Securities Appellate Tribunal
Iifl Commodities Limited vs Sebi on 9 June, 2021
Author: Tarun Agarwala
Bench: Tarun Agarwala
BEFORE THE SECURITIES APPELLATE TRIBUNAL
MUMBAI
Date of Decision : 09.06.2021
Appeal No. 608 of 2019
IIFL Commodities Limited
Corporate Office at
IIFL Centre, Kamala city,
Senapati Bapat Marg,
Lower Parel,
Mumbai - 400 013.
Registered office at
143, MGR Road, Perungudi,
Chennai, Tamil Nadu - 600 096. ...Appellant
Versus
Multi Commodity Exchange of India Limited
Exchange Square, Suren Road,
Andheri (East),
Mumbai - 400 093. ...Respondent
Mr. Somasekhar Sundaresan, Advocate with Ms. Yugandhara
Khanwilkar, Mr. Ankur Loona and Ms. Aparna Wagle and
Ms. Swapna Roopavate, Advocates i/b Alliance Law for the
Appellant.
Mr. Sameer Pandit, Advocate with Ms. Sarrah Khambati and
Mr. Pranay Kamdar, Advocates i/b Wadia Ghandy & Co for
the Respondent.
2
AND
Appeal No. 609 of 2019
IIFL Commodities Limited
Corporate Office at
IIFL Centre, Kamala city,
Senapati Bapat Marg,
Lower Parel,
Mumbai - 400 013.
Registered office at
143, MGR Road, Perungudi,
Chennai, Tamil Nadu - 600 096. ...Appellant
Versus
Multi Commodity Exchange of India Limited
Exchange Square, Suren Road,
Andheri (East),
Mumbai - 400 093. ...Respondent
Mr. Somasekhar Sundaresan, Advocate with Ms. Yugandhara
Khanwilkar, Mr. Ankur Loona and Ms. Aparna Wagle and
Ms. Swapna Roopavate, Advocates i/b Alliance Law for the
Appellant.
Mr. Sameer Pandit, Advocate with Ms. Sarrah Khambati and
Mr. Pranay Kamdar, Advocates i/b Wadia Ghandy & Co for
the Respondent.
CORAM : Justice Tarun Agarwala, Presiding Officer
Justice M.T. Joshi, Judicial Member
Per : Justice Tarun Agarwala, Presiding Officer (Oral)
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1.Two appeals have been filed against orders dated October 23, 2019 and October 24, 2019 whereby the respondent has imposed a penalty Rs. 62,35,182/- and Rs. 6,95,167/- for the financial years 2016-17 and 2017-18 respectively. Since issue is common, both the appeals are being decided together.
2. The contention of the appellant is, that the impugned order has been passed by the Vice President, Inspection & Audit of the Multi Commodity Exchange of India Limited ('MCX' for short) which is without any authority of law as the said person does not have the power to adjudicate or impose a penalty under the Securities and Exchange Board of India Act, 1992, Rules and Bylaws of the MCX and that only the Disciplinary Action Committee ('DAC' for short) is empowered to impose a penalty.
3. We have heard Shri Somasekhar Sundaresan, the learned counsel for the appellant and Shri Sameer Pandit, the learned counsel for the respondent.
4. After hearing the learned counsel for the parties, we are of the opinion that the controversy involved in the present 4 appeal is squarely covered by a decision of this Tribunal in Appeal no. 140 of 2018 and 141 of 2018 (India Infoline Commodities Limited vs Multi Commodity Exchange of India Limited dated April 26, 2021 wherein this Tribunal held that whatever penalties which are depicted in the circulars which are uniform in nature and which can be termed automated were only required to be dealt with by the Stock Exchange and where a discretion was involved and penalties could range from 0% to 100% then, in such cases, the matter was required to be placed before the DAC.
5. In view of the aforesaid, the impugned orders cannot be sustained and is set aside. The matter is remitted with a direction that the relevant authority will issue a fresh show cause notice and the appropriate committee / relevant authority will deal with the matter and pass appropriate order in accordance with law and in accordance with the observation made in our order dated April 26, 2021in Appeal No. 140 & 141 of 2018. No order on costs.
6. 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 5 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 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 09.06.2021 Digitally signed RAJALA byRAJALAKSHMI H msb KSHMI NAIR Date:
H NAIR 2021.06.12 19:21:30 +05'30'