VASHI CONSTRUCTION PVT. LTD., RAJESH C. SHAH AND MS. BHAVANA RAJESH SHAH AS DIRECTOR OF VASHI CONSTRUCTION PVT. LTD. Vs. SECURITIES AND EXCHANGE BOARD OF INDIA

JUDGEMENT

(1.) SINCE these three appeals involve common questions of law and fact, with the consent of the learned counsel for all the parties, we have heard the same together and are being disposed of by this common order. For the sake of convenience, the facts of Appeal No. 154 of 2012 (Vashi Constructions Pvt. Ltd. and ors. vs. Securities and Exchange Board of India) have been taken as the leading case. The three appeals are preferred by 11 appellants against the impugned order dated 19th January, 2012 seeking to impose a penalty of Rs. 20 lacs under the provisions of Section 15H(ii) of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as 'the SEBI Act') on them. Two persons namely, Shri Ashok H. Shah and Ms. Neha R. Shethwala have, however, been exonerated as no violation could be established against them before the adjudicating officer.

(2.) BRIEF facts leading to the passing of the above said impugned order are that the Securities and Exchange Board of India (for short SEBI) conducted investigations relating to the preferential allotment of 2,90,00,000 shares @ Rs. 1 each at a premium of Rs. 0.25 per share by the Platinum Corporation limited (hereinafter referred to as 'PCL Comp). These preferential shares were allotted to the following 7 persons on 13th January, 2009: -

(3.) The case of SEBI is that all the above 7 allottees acted in concert with each other for the purpose of acquiring a huge number of shares of PCL Comp through preferential allotment but failed to come out with a public announcement to acquire the said shares as per the requirement of Regulation 10 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as 'SAST Regulations, 1997'). Accordingly, adjudication proceedings were initiated against the following 19 noticees: -