IN THE SECURITIES APPELLATE TRIBUNAL

MUMBAI

 

Appeal No.169/2004

 

Date of Decision

04.05.2006

 

 

In the matter of:

 

Punit Capital & Debt Market   Pvt.Ltd.,and others	Appellants – Represented by Mr. Arvind Rathod, Advocate
Versus
Securities & Exchange Board of India.	Respondent – Represented by Mr. Dipan Merchant, Advocate

Coram:

          Justice N. K. Sodhi, Presiding Officer

          C. Bhattacharya, Member

          R. N. Bhardwaj, Member

 

Per: Justice N. K. Sodhi, Presiding Officer(Oral)

 

            Challenge in this appeal is to the communication dated August 22, 2003 by which the claim of the appellant seeking benefit of fee continuity in terms of paragraph 4  of Schedule III to Securities and Exchange Board of India (Stock Brokers and Sub Brokers) Regulations, 1992 (for short the Regulations) has been declined only on the ground that all the four partners in the erstwhile partnership did not become whole time directors on its corporatisation on 3/4/2000.  A bare reading of paragraph 4  of Schedule III would make it clear that the conditions enumerated in this paragraph are satisfied if any one of the partners of the erstwhile partnership firm becomes a director in the corporate entity after its conversion.  It is not in dispute that prior to conversion on 3/4/2000 the partnership firm had four partners two of whom were made directors of the company after it was incorporated.  This satisfies the requirement of para 4.  In this view of the matter, the impugned communication dated August 22, 2003 declining the claim of the appellant cannot be sustained.

          In the result, the appeal is allowed, the impugned communication dated August 22, 2003 set aside and the respondent is directed to grant the benefit of fee continuity to the appellant.  No costs.

 

Sd/-

Justice N. K. Sodhi
Presiding Officer

Sd/-

C. Bhattacharya
Member

Sd/-

R. N. Bhardwaj
Member

 

 04 /05/2006.