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In the matter of Rashmi Gem Stock & Shares P. Ltd

Jul 22, 2005
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Orders : Orders of SAT

IN THE SECURITIES APPELLATE TRIBUNAL

MUMBAI

 

Appeal No.382/2004

 

Date of Hearing

14.07.2005

Date of Decision

22.07.2005  

 

 

 

In the matter of:

 

Rashmi Gem Stock & Shares P.Ltd., 

Appellant – Represented by Mr. P. D. Desai, Advocate

 

 

 

Versus

 

 

Securities & Exchange Board

of India 

Respondent – Represented by Mr. Ravi Hegde, Advocate.

 

 

 

Coram:

         

          C. Bhattacharya, Member

          R. N. Bhardwaj, Member

 

Per:    C. Bhattacharya, Member

 

 

 

1.       Appeal is taken up for final disposal with consent of both parties.

 

2.       Heard the counsels from both the sides.  The fact of the case is that Securities & Exchange Board of India (SEBI), carried out an inspection of the Books of Accounts and other records of  M/s. Rashmi Gem Stocks & Shares P. Ltd.,  who is a member of the Bangalore Stock Exchange Ltd., The inspection was conducted for the period from April, 2000 to June, 2002.  Certain violations were alleged to have been observed during the inspection.   The findings of the Inspection were communicated and a show cause notice was issued to the appellant and the appellants replied thereto vide their letter dated January 20, 2004. The appellants was also given personal hearings held  on April 5, 2004 and April 23, 2004.  Thereafter, the appellants were served with the impugned  order  dated September 17, 2004 imposing a penalty of Rs.75,000/-.  Being aggrieved, the appellant filed this appeal.

 

3.       By an Interlocutory order dated 21/12/2004 of this Tribunal, stay of the impugned order was granted on the condition that the appellant deposits Rs.10,000/- within two weeks from the date of the order.

 

4.       During the course of hearing both  the sides admitted that the violations noticed by SEBI during the inspection were of procedural nature.  It is further admitted that these deficiencies were subsequently rectified and are not recurring.  Subsequent inspection by SEBI has also confirmed this.

 

5.       While deciding the quantum of penalty, regard must be had to the factors mentioned in section 15J of SEBI Act.  In the instant case admittedly, the violations have been found to be of procedural nature and there is no allegation that the appellant had disproportionate gain or unfair advantage.  There is also no complaint from any investor that any loss was caused to them and steps have  been taken to rectify the deficiencies and comply with the regulatory requirements thereafter.

 

6.       Having regard to the above factors, a penalty of Rs.25,000/- only will meet the ends of justice.  The impugned order stands modified accordingly.   

7.         No order as to costs.

                                               

Sd/-

R. N.  Bhardwaj

Member

Sd/-

C. Bhattacharya

Member

 
 

 

Mumbai,

22nd July, 2005.