BEFORE THE SECURITIES APPELLATE TRIBUNAL
MUMBAI
Appeal No. 213 of 2012

                             Date of decision: 23.11.2012  

Mr. Pramod Gadia
B-506, Preeti Sagar,
New Link Road,
Jayraj Nagar,
Borivali (West),
Mumbai – 400 091.

               ……Appellant  

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. R. S. Loona, Advocate with Ms. Abhaya Gurumurthy, Advocate for the
Appellant.
Ms. Harshada Nagare, Advocate for the Respondent.

CORAM : P. K. Malhotra, Member & Presiding Officer ( Offg. )
S. S. N. Moorthy, Member

Per : P. K. Malhotra (Oral)

With the consent of learned counsel for the parties, the appeal is taken up for
final disposal.

2. The appellant before us is the proprietor of Ekta Shares and Securities. He is
   aggrieved by an ex-parte ad-interim order dated April 23, 2009 passed by the whole
   time member of the Securities and Exchange Board of India (the Board) prohibiting
   him from buying, selling or dealing in the securities market including Initial Public 2
   Offerings, in any manner, either directly or indirectly in the stock market till further
   directions.
3. The Board had initiated investigation in the scrip of Pyramid Saimira Theaters
   Limited (the company) and came to a prima-facie conclusion that a large number of
   entities had joined hands and some of them had carried out suspicious banking
   transactions and had channeled the funds either directly or indirectly in the stock
   market. Pending investigation in the matter, the Board had passed the impugned
   order against 230 entities and the appellant is one of them.
4. The said ex-parte ad-interim order was also a show cause notice asking the
   concerned entities to file their objections, if any, to the proposed action. The
   appellant filed its detailed reply on May 27, 2009 and again on June 24, 2009 denying
   all the allegations and seeking copies of certain documents which, according to him,
   were not made available. Thereafter, a personal hearing was also granted to the
   appellant on December 15, 2009. The grievance of the appellant is that although the
   Board had passed further order against some of the entities, no order has been passed
   against the appellant inspite of the fact that the appellant has pursued the matter with
   the Board. It is now more than three and half years and under the garb of ex-parte ad-
   interim order, the appellant is being deprived of his right to trade in the market.
5. We have heard the learned counsel for the parties for some time. We are
   informed that the investigations in the matter were concluded in July 2011 and the
   Board is now taking further steps in accordance with law. However, there is nothing
   on record to show as to why no order has been passed against the appellant in
   pursuance to the ad-interim ex-parte order-cum-show cause notice dated April 23,
   2009 even after three years of granting him personal hearing. We have also taken
   note of the fact that the Board had passed an interim order on December 9, 2009
   confirming ex-parte ad-interim order against 20 entities and the appellant is not one
   of them. We are surprised to note that when the personal hearing was given to the 3
   appellant as early as on December 15, 2009 and the Board had also completed
   investigations in the matter as early as in July 2011, why the Board has not been in a
   position to pass an order against the appellant in furtherance of the ex-parte
   ad-interim order dated April 23, 2009. The appellant is now out of the securities
   market for more than three and half years there seems to be no justification to
   continue the said ex-parte ad-interim order. We are, therefore, inclined to stay, qua
   the appellant, operation of the impugned order. We order accordingly. However, it is
   made clear that this order is without prejudice to the rights of the respondent Board to
   proceed further in the matter and shall not be taken as an expression of our opinion on
   the merits of the case. The appeal stands disposed of accordingly with no order as to costs.
   Sd/-
   P. K. Malhotra
   Member &
   Presiding Officer ( Offg. ) Sd/-
   S. S. N. Moorthy
   Member

23.11.2012
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