ORDER
Kumar Rajaratnam, J. (Presiding Officer)
1. The appeal is taken up for disposal with the consent of parties.
2. The appellant being aggrieved by the order of the respondent in imposing penalty of Rs. 50,000/- for delay in complying with the Regulation 6(1) and Regulation 6(3) of the SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997 has preferred this appeal.
3. The brief facts of the case are that the appellant is one of the promoters of M/s. Jayant Agro-Organics Ltd., the shares of which have been listed on the Mumbai Stock Exchange and also on National Stock Exchange, Mumbai. The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 came into force from 20/02/1997. The disclosures under Regulations 6(1) and 6(3) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 were due on 20/04/1997 but were actually complied on 06/06/1997 and 26/05/1997 respectively. SEBI issued show cause notice dated 24/07/2003 with respect to the above mentioned delay:
4. The appellant by its letter dated 04/08/2003 replied to the said show cause notice pleading for clemency and raised the following mitigating circumstances.
a) Initially, there was a slight delay to comply with the newly introduced Regulations as certain intricacies involved therein were required to be got clarified.
b) Except the initial delay, further compliance was done within the prescribed period. There were no repetitive defaults;
c) Even the initial compliance was done on their own.
d) There was no wrongful gain to the company nor any loss to any investor on account of slight delay in compliance;
e) There was absolutely no intention on the part of the appellant to avoid compliance with any regulation.
5. We feel, taking into account that the respondent itself has stated that the delay is not substantial (page 3 of the impugned order) it would be appropriate to rely on the judgment of the Bombay High Court in the case of M/s. Cabot International Corporation in appeal No. 24 of 2000 and the observations made therein and reduce the penalty in the facts and circumstances of the case.
6. Taking into account the reasons given for the delay it would be appropriate to reduce the penalty from Rs. 50,000/- to Rs. 15,000/-. The order is modified accordingly. The appellant is directed to pay the amount to the respondent within 4 weeks from the date of receipt of this order. The appeal is disposed of accordingly.
7. No order as to cost.