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2016 (7) TMI 877 - AT - Companies LawBonafide public announcements - whether, the WTM of SEBI is justified in holding that some of the unimplemented corporate announcements were made by SIL with the fraudulent intention of influencing the price of SIL scrip and thereby enable the promoter group entities to off load the shares of SIL at the inflated prices and make unlawful gains? - Held that:- There is nothing on record to suggest that any meetings were held with adjoining land owners and Vishwas Infrastructure Ltd. in connection with the alleged joint venture, before or after the public announcements. Further, the land documents furnished by the appellants related to the year 2009, whereas, the public announcements relating to acquisition of lands were made in the year 2007. Moreover, the said documents related to notices of stamp duty and corresponding sale deeds with regard to some agricultural land, to which neither SIL nor Vishwas Infrastructure Ltd. were parties. Apart from the above, very fact that proposal to acquire 200 acres of land has been abandoned on ground of unavailability of appropriate tract of land and steep rise in land prices, clearly shows that the public announcements were made without ascertaining the availability of suitable land at suitable prices. Moreover, decision to abandon the project relating to acquisition of land under joint venture was taken belatedly and even BSE was intimated about the abandonment of the proposal for acquisition of 200 acres of land much after the issuance of show cause notice by SEBI. In these circumstances, the decision of the WTM of SEBI that the public announcements relating to acquisition of 200 acres of land for development under joint venture was not made with bonafide intentions cannot be faulted. Even the public announcements relating to amalgamation of companies cannot be said to be bonafide announcements because, after making such public announcements no further steps were taken in that behalf. Argument of the appellants that they were waiting for the right time to act on the proposal is unacceptable because, in the ordinary course, decision to amalgamate companies is taken only if the circumstances as on that date demand amalgamation of companies. In the present case, public announcements relating to amalgamation were made in the year 2007, however, no steps were taken to implement it for several years and it is only on 30.4.2013, after receipt of show cause notice issued by SEBI, SIL announced withdrawal of its decision relating to amalgamation of Companies. Thus it is abundantly clear that the public announcements relating to amalgamation of companies were not bonafide public announcements. For all the aforesaid reasons, the decision of WTM of SEBI that three public announcements made by appellants were not made with bonafide intentions cannot be faulted. These unimplemented public announcements coupled with various other factors led the WTM of SEBI to arrive at a conclusion that the unimplemented public announcements were made with fraudulent intentions to facilitate the promoter group entities to off load the shares of SIL at inflated prices. In these circumstances no fault can be found with the impugned order. Since the appellants have already undergone the punishment, question of considering any mitigating factor does not arise.
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