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Documents citing Tata Tea Limited vs Sebi on 15 September, 2009

E-Land Fashion China Holdings Limited vs Sebi on 24 May, 2011

In this background, we are satisfied that the promoters have the capability of building a strong business from scratch and as a result of their understanding of the market they have the ability to compete with the business of the target company. If they were to do that, it would neither be in the interest of the target company nor in the interest of its shareholders. We are further satisfied that the payment of non-compete fee in the instant case is not an attempt on the part of the appellant to reduce the cost of acquisition to discriminate against the public shareholders. The aforesaid observations made by the Tribunal in the case of Tata Tea Ltd. (supra) and also in the case of Cementrum IB.V. vs. Securities and 10 Exchange Board of India and anr. Appeal no. 28 of 2008 decided on July 8, 2008 squarely support the case of the appellant.
Securities Appellate Tribunal Cites 10 - Cited by 2 - Full Document

I.P.Holding Asia Singapore P.Ltd. vs Securities & Exch.Board Of India on 20 August, 2014

17. The Tribunal then found that in so far as the two individuals that is Yogesh Bangur and Ms. Surbhi Bangur are concerned, they had no experience in the business of the target company and they were paid non-compete fee only because they happened to be shareholders in the target company. It was held that these two individuals were not involved in the day to day business of the target company and were not capable of providing any threat to the business of the target company. The Tribunal held that in contrast, Ms. Sheetal Bangur was a director in the target company and involved in its day to day business but she was not given any non-compete fee only because she was not a shareholder. It was concluded, on this 3 Tata Tea Ltd. v. SEBI (Appeal No. 136 of 2008); Cementrum IB v. SEBI (Appeal No. 28 of 2008); E-Land Fashion China Holdings Ltd. v. SEBI (Appeal No. 27 of 2011) 10 basis, that the non-compete fee was directly linked to the shareholding of the promoter entities and had nothing to do with the possibility of their being in competition with the target company.
Supreme Court - Daily Orders Cites 9 - Cited by 1 - M B Lokur - Full Document

Ip Holding Asia Singapore Pte Ltd. & ... vs Sebi on 12 September, 2012

However, in the case of Tata Tea Limited (supra), this Tribunal had specifically observed that while looking into the justification for the non compete consideration, scrutiny by the Board cannot be ruled out. It was further observed by the Tribunal that if the fee is paid to a person 15 who cannot compete, the Board may be entitled to say that it is only a device to reduce the offer price and in such a case the Board may justifiably direct its addition to the offer price. On the other hand, if the payment is made to an outgoing seller who can offer competition to the business of the target company, the Board shall have no occasion to interfere. The question to be addressed is whether outgoing sellers are capable of providing competition to the business, alone or in association with third parties and not whether the business was dependent on the outgoing seller. (emphasis supplied)
Securities Appellate Tribunal Cites 5 - Cited by 0 - Full Document
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