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2015 (12) TMI 369 - SC - Companies LawAmended Regulations effective from 1.10.2006 introducing Schedule IIIA into the Regulations questioned - Interpretation of provisions of Securities and Exchange Board of India (Stock-brokers and sub-brokers) Regulations, 1992 (for short the Regulations) as amended from time to time including Schedule III and IIIA - Held that:- We find ourselves in agreement with submissions advanced on behalf of the appellant that after 30th September, 2006 i.e. after Schedule IIIA admittedly became applicable to the appellant, no provisions in Schedule III could be applied to his case. We also find no merit in the contention advanced on behalf of SEBI that clause 4 of Schedule IIIA protects the demand raised by SEBI. Clause 4 of Schedule IIIA along with clause 3 occurs in Part B which relates to charge of fees. It reads as follows : “4 – Nothing in clause 3 shall affect the liability of any stock broker to pay fees under Schedule III, which accrued before this Schedule became applicable to him and such fees shall be paid as per the relevant provisions of Schedule III as if they had not ceased to be applicable to him.” The aforesaid clause is clarificatory in nature. It clarifies that the liability to pay fees as per Schedule III which has already accrued and got fastened to a stock-broker before the Schedule IIIA became applicable, would remain payable as per the provisions of Schedule III even after they cease to be effective for subsequent period. This clause in our view does not affect the enforceability of Schedule IIIA from the date it became applicable to the appellant on account of option permitted by the relevant provisions. After Schedule IIIA became applicable, the Registration fee for any future period since 1.10.2006 could not be levied or demanded on the basis of Schedule III. It had to be calculated on the basis of monthly turnover and payable each month as per provisions in Schedule IIIA. Thus the impugned order of the SAT under appeal to be contrary to law. The same is accordingly set aside. The Appeal is allowed.
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