TMI Blog2010 (4) TMI 602X X X X Extracts X X X X X X X X Extracts X X X X ..... ss the same at the rate as stipulated in the Regulations and also calculate the interest leviable at the specified rate. The SEBI will consider whether a concession of reduction of interest should be allowed or not. - APO NO. 498 OF 2006 - - - Dated:- 13-4-2010 - KALYAN JYOTI SENGUPTA AND MD. ABDUL GHANI, JJ. Soumen Sen for the Appellant. Surojit Nath Mitra for the Respondent. JUDGMENT Kalyan Jyoti Sengupta, J. - The appellant above-named has preferred this appeal against the judgment and order of the learned Single Judge dated 20-9-2004 which has also been impugned by the cross-objection filed by the writ petitioner-respondent. 2. All the parties advanced common argument in both the matters, therefore, the same are disposed of by the following judgment and order before the learned trial Judge. The aforesaid writ petition WP No. 1597 of 2004 was filed by the writ petitioner-respondent/cross-objector on the following summarised fact : The writ petitioner Chandidas Ghosh in the capacity of the Secretary of the Security, Stock Brokers Welfare Association of India ( the said Association ) which is a registered association under the Societies Registratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n fee together with 20 per cent of the outstanding interest. The benefit given by the said Scheme was framed intending to absolve the defaulter stock brokers from paying the balance 80 per cent of the outstanding interest. The said scheme for regularisation was for a limited period commencing from 15-10-2004 and ending on 15-11-2004. Under the said Scheme it was provided amongst others that after expiry of the period of the said scheme a broker having outstanding registration fee liabilities, shall be liable to pay the entire outstanding amount including full interest, and shall also be subjected to appropriate enforcement action under the said SEBI Act, 1992 and regulations framed thereunder and such broker may face suspension or cancellation of certificate of registration or prosecution under section 24 of the said Act of 1992. Obviously, the said registration fee has to be calculated and paid basing on turnover data with break up as certified by the auditors. 5. The members of first writ petitioner wanted to have the benefit of the said scheme. However, they were not allowed to submit audited turnover data with break-up and also to make payment of the registration fee. In vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appropriate order directing the respondent No. 3 to forthwith accept the turnover data prepared by the members of the Stock Brokers Welfare Association of India, to submit the same to the respondent No. 2 for the purpose of payment of outstanding registration fees by the members of the Stock Brokers Welfare Association of India. ( i ) Ad interim order in terms of prayers ( g ) and ( h ) above. ( j )Costs of and incidental to this application be borne by the respondents. ( k )Such further or other order or orders be made and/or directions be given as to this Hon ble Court may seem fit and proper." 6. The said writ petition was opposed by the appellant herein by filing affidavit. Learned trial Judge by the impugned judgment and order has held that the provision made in Part II of the scheme for payment of registration fee at flat rate of 0.01 per cent on the gross turnover reported by the stock exchange to the Board in case of failure of submission of turnover data within time stipulated is ultra vires the provision in the Schedule of its Regulations. However, in spite of holding that the learned trial Judge did not grant any relief to the writ petitioner allowing them ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as v. State of Assam AIR 1981 Gauhati 18. 12 The steps taken for fixing the aforesaid flat rate is the best possible method which could be compared with the concept of - "best judgment" as frequently adopted under Income-tax Act, 1961. In fact in a similar case Gujarat High Court has held that the aforesaid flat rate is legally acceptable. In spite of the aforesaid legal proposition and factual position of acceptance by the Gujarat High Court the learned trial Judge did not discuss and consider the same. 13. Mr. Surojit Nath Mitra, advocate, appearing for the writ petitioner-respondent elaborating the facts mentioned in the writ petition submits that action taken by the SEBI floating the aforesaid scheme is incomplete breach of the status quo order passed by this court in the previous writ petition on 22-3-2002 which continued till 4-7-2004 by virtue of Appeal Court s order. Under such circumstances, the SEBI could not float the aforesaid scheme. Similarly the petitioners being parties to the earlier writ petition could not file the turnover data nor could avail of the aforesaid scheme. Therefore, refusal of the SEBI to accept the payment of registration fee with the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of 1992 nor the Rules framed thereunder nor even the Regulations of 1992 empower SEBI to claim registration fee at a flat rate of 0.01 per cent or to take away right of the brokers to pay such Registration Fee at concessional rates mentioned in paragraph 5(BB) of Schedule III of the said Regulations of 1992. He urges on the strength of an authority, namely, Hukum Chand Shayam Lal v. Union of India AIR 1976 SC 789 that when an act is required to be done in a particular way it has to be done in that manner only or not at all. Besides article 265 of the Constitution of India does not allow any authority to impose any tax or levy whatever may be without any authority of law. 17. He further submits that the said administrative order is conflict with the Act, Rules and Regulations, hence, it must yield to the letters. He refers to a Supreme Court judgment Union of India v. Arun Kumar Roy AIR 1986 SC 737 to support this legal submission. The concept of implied authority of the SEBI is wholly baseless and fallacious, as a statutory authority has to act within the power expressly vested in law. Principle of best judgment has no application unlike Income-tax Act and Rules as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the continuance of the order of status quo which continued till 22-4-2004 in terms of the order of the learned trial Judge when writ petition was dismissed and during the period from 20-5-2004 till 4-6-2004 passed by the appeal court. According to them such action of this appellant-SEBI is in violation of order of status quo and that interpretation of the order of status quo , of the appellant ought not to be accepted. If there be any ambiguity with regard to scope and purport of any order of the court one has to approach court. He refers to the Supreme Court decisions in Satyabrata Biswas case ( supra ) to support this plea. 22. We find that the learned trial Judge has interpreted the scope and purport of the order of status quo and held that said order of status quo does not extend to disentitle the SEBI from issuing subsequent notification. The learned trial Judge held that order of status quo passed in the context of the facts and circumstances placed in the earlier writ petition and it only applies in connection with payment of Registration Fee having correlation with the word turnover and also for taking punitive measure. When the learned trial Judge h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urnover data without payment of registration fee being contrary to Regulations of 1992 is liable to be declared void and that SEBI could not call for furnishing turnover data independent of Registration Fee. We are of the view that such argument has no force at all as unless the turnover data is furnished the registration fee cannot be levied. The decision of the Supreme Court in Sukhdev Singh s case ( supra ) is completely misplaced here as we find there has been direct nexus if not basis for computation and realisation of the registration fee. Registration fee can legitimately be calculated and realised only when turnover data is furnished or is made available. Therefore, we do not see any reason that any scheme or notice asking for filing turnover data without Registration Fee is void or contrary to Regulations. Sections 11 and 12 of the said Act is wide enough empowering appellant to frame amongst other schemes in order to fulfil the object of the said Act and such scheme should always be consistent with extant rules, regulation and the provision of the Act. The scheme providing for furnishing turnover data is not inconsistent with any of the aforesaid provisions. 25. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... workable. We have gone through the aforesaid decisions cited by the learned counsel namely Bidi Leaves Tobacco Merchants Association s case ( supra ), National Tobacco Co. of India Ltd. s case ( supra ) and Arbinda Das case ( supra ). In those decisions factually found that the authority concerned under the respective Acts did not have any specific power to deal with the situation aiming at to prevent non-fulfilment of the object of the Act. In this case, we find that problem basically is for realisation of the registration fee which has to be done on the basis of the turnover data. The Regulations already framed has made it clear in case of failure of a registration fee the penal consequences will follow. We are of the view that for failure to furnish turnover data by the stock broker there was no warrant to frame a scheme for payment of registration fee at a flat rate of 0.01 per cent for turnover data is not asked to be furnished for furnishing sake, it is intended to be done with the object of realising registration fee. According to us when the Regulations framed under law provides for penal measure to achieve same object, it is not simply permissible under the law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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