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2020 (11) TMI 1013 - AT - SEBIValidity of Ex-parte adinterim order dated October 20, 2020 passed by the Whole Time Member - attachment of demat accounts and bank accounts of respondent - Section 11 and 11B of the Securities and Exchange Board of India Act, 1992 - HELD THAT:- The direction of the WTM to deposit a sum of ₹ 1292.46 crore is wholly arbitrary and has been passed without any application of mind. Admittedly, the sale consideration has to be distributed to the shareholders of the Company after meeting the tax liability, indemnity, transaction cost, debt outstanding etc. According to the Company which is recorded in the impugned order, the total amount comes to ₹ 1026.44 crore and the balance left for distribution of the shareholders is ₹ 854.40 crore which amount is also reflected in the annual report 2018-19 as well as in the report of BSE dated December 12, 2019 - the direction to deposit the entire sale consideration of ₹ 1292 is neither appropriate nor beneficial to the survival of the Company at this stage. The fact that 50% of the sale consideration is also required to be distributed to the promoters and promoters group has not been disputed by the respondent. The respondent knowing fully well that a substantial amount was parked in fixed deposits, the direction to the appellant to deposit ₹ 1292. 46 crore in an escrow account is neither just nor proper especially when there is no specific finding on diversion of funds. The written note submitted by SEBI further indicates that a sum of ₹ 1002 crore is lying in fixed deposits - the direction to deposit further amount would cripple the Company and bring it to down to its knees which is neither in the interest of the Company nor in the interest of its shareholders. The appellant no. 1 Company shall deposit a sum of ₹ 500 crore in a separate escrow account within 10 days from today, the details of which would be supplied to SEBI and to the stock exchanges - Appeal allowed.
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