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2016 (11) TMI 297 - SC - Companies LawJustification for long delay on the part of the SEBI in granting approval to the offer of the appellant and situation having changed to the prejudice of the appellant, the appellants are entitled to withdraw their offer - Held that:- We are in agreement with the finding recorded by the SAT that there was undue delay on the part of the SEBI in dealing with the DLO. No doubt, in a given case timeline prescribed under the Regulations may not be adhered to when the SEBI justifiably takes time in dealing with the complaints, as rightly submitted by Shri Datar, in the present case, the stand of the SEBI itself is that it could not go into the complaints for which the right forum was CLB. As regards the time taken in dealing with the complaints against the acquirers, the SEBI could have promptly proceeded with the matter. However, mere upholding of finding of SAT on the aspect of delay by SEBI is not enough to hold that the appellants are entitled to withdrawal of the public offer. The withdrawal has to be dealt with under Regulation 27, as held by this Court. The general principle is that public offer once made cannot be withdrawn. Exception to the rule is the specified situations under the Regulation as laid down by this Court in above decisions particularly in Nirma Industries Limited (2013 (5) TMI 629 - SUPREME COURT OF INDIA). In the present case, though SEBI was not justified in causing delay in giving its comments on public offer, this by itself is not enough to justify withdrawal from public offer so long as the case does not fall under Regulation 27. First question is answered accordingly. To what extent unilateral action of the target company in dealing with the property of the company after a hostile public offer is made furnish cause of action to the acquirers to withdraw the public offer and whether in the present case, decision not permitting withdrawal of public offer is justified? - Held that:- In the present case, the SEBI as well as the SAT have concurrently held that public offer is capable of being carried out and has not become impossible. The assets are available with the target company. Finding has also been recorded about the circumstances preceding the public offer and the conduct of the acquirer which is based on record. The steps for development of the Vile Parle property had already been initiated and the acquirer had taken remedies before the CLB against the decision of the target company and had settled the matter with the target company. It is clear from the scheme of the regulations that there is no absolute bar for the target company to take decision about its assets, subject to compliance with statutory procedure and subject to the decision being otherwise valid. There is no doubt that against any mala fide, illegal or unjustified decision of the target company, remedies at appropriate fora are available to the aggrieved parties. Thus, there is no justification for automatic withdrawal from public offer without clear prejudice to the acquirer to the extent of rendering the carrying out of public offer impossible. In the facts of the present case, we do not find any ground to interfere with the concurrent finding of the SEBI and the SAT that request for withdrawal from public offer was not justified. Question (ii) is answered accordingly.
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