BEFORE THE SECURITIES APPELLATE TRIBUNAL
MUMBAI
Order Reserved On: 23.04.2019
Date of Decision: 26.04.2019
Misc. Application No. 262 of 2018
And
Appeal No. 319 of 2018
Brijmohan Rathi
Plot No. R- 802 TTC,
Industrial Area,
Thane Belapur Road,
MHAPE, Navi Mumbai- 400 701
…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. Anant Upadhyay, Advocate for the Appellant.
Mr. Anubhav Ghosh, Advocate with Ms. Vidhi Jhawar,
Advocate i/b The Law Point for the Respondent.
WITH
Misc. Application No. 271 of 2018
And
Appeal No. 332 of 2018
Sunciti Financial Services Pvt. Ltd.
Plot No. R- 802 TTC,
Industrial Area,
Thane Belapur Road,
MHAPE, Navi Mumbai- 400 701
…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
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Mr. Anant Upadhyay, Advocate for the Appellant.
Mr. Anubhav Ghosh, Advocate with Ms. Vidhi Jhawar,
Advocate i/b The Law Point for the Respondent.
WITH
Misc. Application No. 269 of 2018
And
Appeal No. 330 of 2018
New Era Advisors Pvt. Ltd.
Plot No. R- 802 TTC,
Industrial Area,
Thane Belapur Road,
MHAPE, Navi Mumbai- 400 701
…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. Anant Upadhyay, Advocate for the Appellant.
Mr. Anubhav Ghosh, Advocate with Ms. Vidhi Jhawar,
Advocate i/b The Law Point for the Respondent.
WITH
Misc. Application No. 270 of 2018
And
Appeal No. 331 of 2018
Maharashtra Polybutenes Ltd.
Plot No. R- 802 TTC,
Industrial Area,
Thane Belapur Road,
MHAPE, Navi Mumbai- 400 701
…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
3
Mr. Anant Upadhyay, Advocate for the Appellant.
Mr. Anubhav Ghosh, Advocate with Ms. Vidhi Jhawar,
Advocate i/b The Law Point for the Respondent.
WITH
Appeal No. 318 of 2018
New Era Advisors Pvt. Ltd.
Plot No. R- 802 TTC,
Industrial Area,
Thane Belapur Road,
MHAPE, Navi Mumbai- 400 701
…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. Anant Upadhyay, Advocate for the Appellant.
Mr. Anubhav Ghosh, Advocate with Ms. Vidhi Jhawar,
Advocate i/b The Law Point for the Respondent.
AND
Appeal No. 325 of 2018
Maharashtra Polybutenes Ltd.
Plot No. R- 802 TTC,
Industrial Area,
Thane Belapur Road,
MHAPE, Navi Mumbai- 400 701
…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
4
Mr. Anant Upadhyay, Advocate for the Appellant.
Mr. Anubhav Ghosh, Advocate with Ms. Vidhi Jhawar,
Advocate i/b The Law Point for the Respondent.
CORAM: Justice Tarun Agarwala, Presiding Officer
Dr. C.K.G. Nair, Member
Justice M. T. Joshi, Judicial Member
Per: Justice Tarun Agarwala
1.

The controversy involved in this group of appeals is the
same and arises out of the same issue. Even though, separate
impugned orders have been passed, these appeals are being
decided together.

2.

Appeal No. 319 of 2018, 332 of 2018 and 330 of 2018
have been filed against the order of the Adjudicating Officer
(“AO” for convenience) of the Securities and Exchange Board
of India (“SEBI” for convenience) for violating 15H read with
Section 27 of the SEBI Act, 1992 and Regulations 3 and 4 of
the Securities and Exchange Board of India (Prohibition of
Fraudulent and Unfair Trade Practices relating to Securities
Market) Regulations, 2003 (“PFUTP” Regulations, 2003” for
convenience) for wrongful trading in the shares of Maharashtra
Polybutenes Limited (hereinafter referred to as “MPL”) wherein
a penalty was imposed. In Appeal No. 331 of 2018 the AO of
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SEBI has imposed a penalty for violating Section 12 of the
SEBI Act, 1992 read with Regulations 3 and 4 of the PFUTP
Regulations, 2003 for wrongful disclosure in the change in the
shareholding pattern in MPL and wrongful disclosure of
pledging of shares by the promoters.

3.

In Appeal No. 319 of 2018 there is a delay of 985 days in
filing the appeal. In Appeal No. 332 of 2018 there is a delay of
880 days. In Appeal No. 330 of 2018 there is a delay of 353
days and in Appeal No. 331 of 2018 there is delay of 353 days
in filing the appeal.

4.

In Appeal No. 319 of 2018 and Appeal No. 332 of 2018
the ground urged is that the appellants were exploring the
implications of the impugned order and possibilities of
challenging it.

Further, the appellants were awaiting the
outcome of the adjudication proceedings of the company MPL
and in the said process of filing the present appeals, the
appellants consulted experts and advisors who could assist them
without fee which took time. On these grounds the appellants
have prayed that the delay in filing the appeals may be
condoned.

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5.

In Appeal No. 330 of 2018 and 331 of 2018 the ground
urged is virtually the same, namely, that after receiving the
impugned order the appellants were exploring the implications
of the impugned order and possibilities of challenging it and
consulted expert and advisors who could assist without fee
which took time. Further, the appellants were unable to arrange
the court fee in the light of the adverse financial conditions
faced by the appellants which also led to further delay in filing
the appeals. The appellants in these two appeals prayed that the
delay should be condoned.

6.

The aforesaid applications have been vehemently opposed
by the learned counsel for the respondent contending that no
sufficient cause has been shown to condone the delay nor any
adequate or legal reasons have been given in support of their
contentions. The learned counsel for the respondent had relied
upon a decision of Balwant Singh (Dead) V/s Jagdish Singh
and Others (2010) 8 Supreme Court Cases 685.

7.

Having heard the learned counsel for the parties at some
length, we find that there is an inordinate delay in filing the
appeals. The contention of the appellants in Appeal Nos. 319 of
2018 and 332 of 2018 that they were awaiting the outcome in
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the appeals by the company MPL is patently misconceived and
cannot be utilized for the purposes of condoning the delay. The
appeal is required to be filed within 45 days.

Such limitation
was known to the appellants and, therefore, waiting for the
outcome of another adjudication proceedings cannot be a
cogent, valid or legal ground to condone the delay nor does such
ground could come under expression “sufficient cause”.

8.

Further, the contention of all the appellants that after
receiving the impugned orders the appellants were exploring the
implications of the impugned order and possibilities of
challenging it and consulted experts and advisors who could
assist them without fee is not only vague but clearly an
afterthought. No details have been given as to which expert the
appellants had consulted, which expert was demanding
remuneration or legal fee and which consultant or expert agreed
to give advice without taking a fee. In the absence of any such
assertion, we are of the opinion that the ground urged is vague
and untenable. In our view sufficient cause has not been shown
nor any satisfactory or reasonable explanation has been given
for condoning of delay.

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9.

There is no doubt that the expression of “sufficient cause”
is intended to advance substantial justice which itself
presupposes no negligence or inaction on the part of the
appellant. In the instant case, waiting for the outcome of a
proceeding in another adjudication matter or exploring the
possibilities of challenging the impugned orders without giving
satisfactory explanations tantamounts to negligence or inaction
on the part of the appellants and, therefore, such ground cannot
be termed as bonafide. The Supreme Court in Balwant Singh
(Supra) has held that the expression “sufficient cause” implies
the presence of adequate and legal reasons which in the instant
case is lacking.

We find that sufficient cause has not been
shown for condoning the delay which is just one of the
ingredients which has to be considered by the Court/ Tribunal.
In addition to this, we find that the conduct of the appellants and
the reasons given for condoning the delay was not bonafide.
The delay could have been avoided if the appellant had acted
with normal care and caution.

In our view, the statutory
provisions mandate that applications for condonation of delay
filed beyond the prescribed period of limitation should be
rejected unless sufficient cause is shown for condonation of
delay which in the instant cases was neither bonafide nor
adequate.

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10. Consequently, for the reasons stated aforesaid, we do not
find any reasons to condone the inordinate delay in filing the
appeals.

The Miscellaneous Applications are rejected, as a
result of which, the appeals are dismissed.

11. Appeal No. 318 of 2018 and 325 of 2018 have been filed
challenging
the Recovery Certificates.

These
Recovery
Certificates were issued for non-payment of the amount
mentioned in the impugned orders passed by the AO. Since the
appeals questioning the main orders have been dismissed by us
on the ground of delay the appeals challenging the Recovery
Certificates lack merit and are also dismissed.

In the
circumstances of the case, party shall bear their own costs.

Sd/Justice Tarun Agarwala
Presiding Officer
Sd/Dr. C.K.G. Nair
Member
Sd/Justice M. T. Joshi
Judicial Member
26.04.2019
Prepared & Compared By: PK