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d. TGVL has not disclosed material deviation from the main activity of the company.
e. Independent directors having peculiar relationship with TGVL by owning equity shares of TGVL."

6. The WTM after considering the replies of the appellant and the material evidence on record concluded that the appellant misrepresented its financials and violated the accounting standards. The WTM found that various provisions of LODR Regulations was not complied with during the three financial years and there were lapses on the part of the Company in not making the disclosures within the stipulated period. The WTM further found that non- furnishing of information to the forensic auditor was violation of Section 11(2)(i) of the SEBI Act. The WTM further found that there was no violation of Section 12A of the SEBI Act and Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Markets) Regulations, 2003 (hereinafter referred to as „PFUTP Regulations‟) as there was no misappropriation of the funds nor the Company nor its Directors had played a fraud upon the investors nor was there any disproportionate gain or unfair advantage nor any specific loss was incurred by any investor. The WTM accordingly for the above violations debarred the appellant from accessing the securities market for specified periods and imposed different amounts of penalties on the appellants.

18.

15. We are of the opinion that irrespective of Section 186 of the Companies Act, Regulation 23(3) of LODR stipulates that inter party transaction requires prior approval of the audit committee and since approval was not taken, the Company had violated Regulation 23(3) of the LODR Regulations.

16. Similarly, a finding has been given by the WTM for violation of Regulation 23(2) of the LODR Regulations for not placing the minutes of the meeting of the subsidiary companies for approval from the shareholders of the parent Company. It was urged that the minutes of the meeting of the subsidiaries was not placed before the Board since it was a related party transaction with the subsidiaries which does not require approval from the audit committee under Regulation 23(5). Be that as it may. The minutes of the meeting of the subsidiary Company was required to be placed before the shareholders of the Company for its approval which admittedly was not done.

22. In the instant case, we find that the violation of the LODR Regulations gave no disproportionate gain to anyone nor created any unfair advantage to the appellant nor any specific loss was caused to any investors and, therefore, in our opinion the direction of debarment and penalty imposed for violation of the LODR Regulations appears to be harsh and excessive. This Tribunal while entertaining the appeal had passed an interim order on 3rd September, 2021 and had granted an interim order staying the effect and operation of the impugned order provided the appellant deposits 25% of the penalty amount.

23. This Tribunal further directed that the amount was required to be kept in an interest bearing which would be subject to the result of the appeal.

24. Accordingly, while affirming the violation committed by the Company with regard to non- compliance of the LODR Regulation, we direct that the period undergone towards debarment of the appellants is sufficient for the aforesaid violations and, consequently, the period is reduced to the period underwent by the appellants. In addition to the aforesaid, we reduce the penalty directing the appellant Company to pay a sum of Rs.10 lakhs for violation of the LODR Regulations. The penalties imposed upon the other appellants are set aside. The appeal is partly allowed. In the circumstances of the case, parties shall bear their own costs. Any excess amount deposited by the appellant pursuant to the interim order shall be refunded by the respondent along with interest accrued, if any, within four weeks. Misc. application no.186 of 2022 is also disposed of accordingly.