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Inter Globe Finance Limited v/s Securities and Exchange Board of India, SEBI Bhavan

    Misc. Application No. 224 of 2017 & Appeal No. 189 of 2017

    Decided On, 18 August 2017

    At, SEBI Securities Exchange Board of India Securities Appellate Tribunal

    By, THE HONOURABLE MR. JUSTICE J.P. DEVADHAR
    By, PRESIDING OFFICER & THE HONOURABLE DR. C.K.G. NAIR
    By, MEMBER

    For the Appellant: Zal Andhyarujina, Prakash Shah, Robin Shah, i/b Prakash Shah & Associates, Advocates. For the Respondent: R1, Tomu Francis, Vivek Shah, R2, Nair Renjith Ramesh, Advocate i/b M/s. The Law Point, Advocates.



Judgment Text

J.P. Devadhar, Presiding Officer (Oral)

1. Without conducting any investigation and without hearing the appellant, whether the Securities and Exchange Board of India ('SEBI' for short), solely based on the letter dated 09.06.2017 received from the Ministry of Corporate Affairs (MCA), is justified in passing the ex-parte order on 07.08.2017 and directing the stock exchanges to treat, inter alia, the appellant company as a ‘suspected shell company’ and suspend the daily trading in the securities of the appellant company on the stock exchanges by moving the securities of the appellant company to Stage VI of Graded Surveillance Measure ('GSM' for short) is the question raised in this appeal.

2. Similar question was raised in the case of J. Kumar Infraprojects Ltd. (Appeal No. 174 of 2017) and by our order dated 10.08.2017 we have stayed direction 1(a) & (b) contained in the impugned communication of SEBI dated 07.08.2017 qua the appellant therein.

3. In view of the facts set out in the Memorandum of Appeal and other documents tendered at the time of hearing relating to annual turnover of the appellant company for last three years, which even according to SEBI prima facie appear to be correct, we extend the said stay to the case of the appellant company herein and direct the stock exchanges to reverse their decision in respect of the appellant company as expeditiously as possible.

4. Appellant company is at liberty to make a representation to SEBI against the impugned communication of SEBI dated 07.08.2017. If representation is made, SEBI shall dispose of the said representation in accordance with law.

5. It is made clear that this order shall not come in the way of SEBI as well as the stock exchanges to investigate the case of the appellant company and initiate proceedings if deemed fit.


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6. Appeal is disposed of in the aforesaid terms with no order as to costs. In view of the disposal of the Appeal, Misc. Application No. 224 of 2017 does not survive and the same is disposed of accordingly.
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