Inventure Growth And Securities Ltd And Others vs Securities And Exchange Board Of India And Others

M. T. Joshi, J

Review Application No.17 of 2019 in Appeal No. 361 of 2018 :

The present review application has been filed by Inventure Growth and Securities Ltd., Nagji K. Rita and Virendra D. Singh. Heard the learned

counsel for the parties and perused the order passed by this Tribunal, the order of the learned Whole Time Member as well as the show cause notice

issued by SEBI and the reply submitted by the present appellant to the said show cause notice.

Upon hearing both sides, in our view, no error apparent on the face of record is found as the order is passed on the relevant submissions made in

the reply to the show cause notice issued by respondent SEBI as well as upon going through the prospectus as regards specific instances quoted in the

order. The Review Application no.17 of 2019 is therefore dismissed.

Review Application Nos. 18 of 2019 and 19 of 2019 in Appeal No. 361 of 2018 :

Review Application No. 18 of 2019 has been filed by Kanji B. Rita and Review Application No. 19 of 2019 has been filed by Vinod K. Shah. The

contention of the learned counsel for the applicants is that there is a factual error in paragraph 28 of our order wherein the applicants Kanji B. Rita

and Vinod K. Shah have been described as Executive Directors whereas the said applicants are non-independent non-executive directors which have

been specifically stated in paragraph 5.6 in Appeal No. 361 of 2018. This fact has not been denied by the respondent. Consequently, there is an error

apparent on the face of the record and the factual position is required to be corrected. Accordingly, the sentence in paragraph 28 “para 5.3

describe†would be read as “para 5.3 to 5.9 describes†and the sentence “Appellant No. 4 Kanji B. Rita and Appellant No. 5 Vinod K. Shah

as Executive Directors†would be read as “Appellant No. 4 Kanji B. Rita and Appellant No. 5 Vinod K. Shah as non-independent non-executive

directorsâ€​. Necessary corrections are carried out in the original order to this extent.

It was urged that the Tribunal has allowed the appeal of Pravin N. Gala in Appeal No. 363 of 2018 who was a non-executive director during the

relevant period. In paragraph 33 of our order, we found that the appellant in Appeal No. 363 of 2018 (Pravin N. Gala) was the non-executive director

during the relevant period and was not responsible for the day to day affairs of the company nor for the transaction of raising a bridge loan. It was

contended that since the applicants Kanji B. Rita and Vinod K. Shah are also non-independent non-executive directors, the same relief should be

granted to them.

The submission of the learned counsel for the applicants appears to be attractive but cannot be accepted. In paragraph 29 of our order, we have

categorically stated that issue of non liability was nowhere raised by the appellants in Appeal No. 361 of 2018 during the arguments. No argument was

raised that they were neither responsible for the day to day affairs of the company or for the transaction of raising the bridge loan. In the absence of

any such assertions being made in their arguments or in the memo of appeal and in the absence of any assertion that the statement made in paragraph

29 is incorrect, we are of the opinion that the review applications of Kanji B. Rita and Vinod K. Shah are misconceived and cannot be accepted on the

strength that being non-independent non-executive directors of the company, they should be given the same relief as given to the appellant Pravin N.

Gala in Appeal No. 363 of 2018. The Review Application Nos. 18 and 19 of 2019 are misconceived and are rejected.

Review Application No. 20 of 2019 in Appeal No. 361 of 2018 :

The present review application has been filed by Arvind Gala and Bhavi Gandhi contending that there is a factual error in paragraph No. 1 of our

order wherein we recorded that the appellants except Arvind Gala and Bhavi Gandhi were prohibited from accessing the securities market for a

period of four years from the date of the order. It was contended that the appellants in the impugned order were prohibited from accessing the

securities market for a period of four years. This fact has not been denied by the learned counsel for the respondent. We also find from the operative

portion of the impugned order that the applicants Arvind Gala and Bhavi Gandhi were also prohibited from accessing the securities market for a period

of four years. Thus, there is an error apparent on the face of the record in paragraph No. 1 which needs to be rectified.

We accordingly, correct paragraph No. 1 of the order. The sentence “appellants except Arvind Gala and Bhavi Gandhi were prohibited from

accessing the securities market for a period of four years from the date of the order†would be read as “appellants were prohibited from

accessing the securities market for a period of four years from the date of the order.â€​

In view of the aforesaid, the restraint order of four years is also reduced to three years for the said applicants and the directions given by us in the

paragraph No. 34 will also apply to the said applicants. Review Application No. 20 of 2019 is accordingly disposed of.