Shivani Gupta vs. Securities And Exchange Board Of India
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Order Issued After Hearing
Purpose:
Fixed Date by Court
Before:
Hon'ble Vineet Saran, Hon'ble J.K. Maheshwari
Stage:
FOR JUDGEMENT
Remarks:
Appeals(s) allowed
Listed On:
19 Apr 2022
In:
Judge
Category:
UNKNOWN
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Order Text
ITEM NO.1501 COURT NO.9 SECTION XVII
S U P R E M E C O U R T O F I N D I A RECORD OF PROCEEDINGS
Civil Appeal No(s). 7054/2021
BALRAM GARG Appellant(s)
VERSUS
SECURITIES AND EXCHANGE BOARD OF INDIA Respondent(s)
([ HEARD BY : HON'BLE VINEET SARAN AND HON'BLE ANIRUDDHA BOSE, JJ. ] IA No.154119/2021-EXEMPTION FROM FILING C/C OF THE IMPUGNED JUDGMENT and IA No.154117/2021-EX-PARTE STAY. )
WITH
C.A. No. 7590/2021 (XVII) ( IA No.162585/2021-EXEMPTION FROM FILING C/C OF THE IMPUGNED JUDGMENT and IA No.162579/2021-STAY APPLICATION)
Date : 19-04-2022 This appeal was called on for pronouncement of judgment today.
| For Appellant(s) | Mr. V. Giri, Sr. Adv.<br>Mr. Krishna Dev Jagarlamudi, AOR<br>Ms. Ankita Gupta, Adv.<br>Ms. Inderdeep Kaur Raina, Adv. |
|---|---|
| Mr. Mehul M. Gupta, Adv.<br>Ms. Arunima Dwivedi, AOR | |
| For Respondent(s) | Mr. Dhaval Mehrotra, Adv.<br>Mr. Sudhanshu Sikka, Adv.<br>M/S.<br>K Ashar & Co., AOR |
Hon'ble Mr. Justice Vineet Saran pronounced the judgment of the Bench comprising His Lordship and Hon'ble Mr. Justice Aniruddha Bose.
The appeals are allowed in terms of the signed reportable judgment. The operative part of the judgment reads as under: Digitally signed by Rachna Date: 2022.04.19 16:03:24 IST Reason: Signature Not Verified
"48. To conclude, the entire case of the
Respondents was premised on two important propositions, that firstly, there existed a close relationship between the appellants herein; and secondly**, that based on the circumstantial evidence (trading pattern and timing of trading), it could be reasonably concluded that the appellants in C.A. No.7590 of 2021 were "insiders" in terms of Regulation 2(1)(g)(ii) of the PIT Regulations. However, as the discussion above would reveal, the WTM and SAT wrongly rejected the claim of estrangement of the Appellants in C.A. No.7590 of 2021, without appreciating the facts and evidence as was produced before them. The records and facts adequately establish that the there was a breakdown of ties between the parties, both at personal and professional level and that the said estrangement happened much prior to the two UPSI. Secondly, as has already been discussed, the SAT erred in holding the appellants in C.A. No.7590 of 2021 to be "insiders" in terms of regulation 2(1)(g) (ii) of the PIT Regulations on the basis of their trading pattern and their timing of trading (circumstantial evidence). We are of the firm opinion that there is no correlation between the UPSI and the sale of shares undertaken by the appellants in C.A. No.7590 of 2021. Moreover, in the absence of any material available on record to show frequent communication between the parties, there could not have been a presumption of communication of UPSI by the appellant Balram Garg. The trading pattern of the appellants in C.A. No.7590 of 2021 cannot be the circumstantial evidence to prove the communication of UPSI by the appellant Balram Garg to the other appellants in C.A. No.7590 of 2021. There is no material on record for the WTM and the SAT to arrive at the finding that both late P.C. Gupta and the appellant Balram Garg communicated the UPSI to the other appellants in C.A. No.7590 of 2021. The said appellants in C.A. No.7590 of 2021 were not** "immediate relatives" and were completely financially independent of the appellant Balram Garg and had nothing to do with the him in any decision making process relating to securities or even otherwise. The submission of the learned counsel of the respondent regarding the same residential address of the appellants also falls flat as admittedly the parties were residing in separate buildings on a large tract of land. Lastly, in our opinion, the SAT order suffers from non-application of mind and the same is a mere repetition of facts stated by the WTM. The Appellate Tribunal was exercising jurisdiction of a First Appellate Court and was bound to independently assess the evidenced and material on record, which it evidently failed to do.
49. Accordingly, the appeals are allowed and the impugned judgement and final orders of WTM and SAT are set aside. The deposits made by the appellants in both the appeals in terms of the impugned orders or interim orders of this Court shall be refunded to the respective appellants.
50. No orders as to costs."
Pending application(s), if any, stands disposed of.
(PRADEEP KUMAR) (ASHWANI KUMAR) BRANCH OFFICER ASTT. REGISTRAR-cum-PS (Signed reportable judgment is placed on the file)