TMI Blog2019 (8) TMI 1474X X X X Extracts X X X X X X X X Extracts X X X X ..... t the appellants for alleged violations. Much water has flown since the alleged violations and at this belated stage the appellants cannot be penalized. It is alleged that disclosure under PIT Regulations was not made but similar disclosure was made by the appellant under SAST Regulations. Therefore, information was available on the Stock Exchange and therefore it cannot be said that the respondents were unaware of the alleged violations. Further, the purpose of disclosure was to make the market aware of the change of shareholding of the shareholders. When a disclosure was made by the company under SAST Regulations the investors became aware of the change in the shareholding. The non-compliance of Regulation 13 if any becomes technical in n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nuary 10, 2011 and they failed to file necessary disclosures under Regulation 13(4) and 13(5) of the Securities and Exchange Board of India (Prohibition of Insider Trading Regulations, 1992 ( PIT Regulations, 1992 for convenience). The second violation alleged was that the Board of Directors of the company in its meeting held on July 22, 2010 recommended for a change in the management of the company in accordance with the provisions of Regulation 12 of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 ( SAST Regulations for convenience) which proposal for change in management of the company was moved through postal ballot for approval of members on July 22, 2010 but no corporate announcement was made to the Exchange ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of PIT Regulations or of the LODR Regulations and therefore on the ground of inordinate delay the proceeding should have been dropped and no penalty could have been imposed. It was contended that the alleged violation occurred in the year 2010 whereas the show cause notice was issued in the year 2018 after eight years for which no explanation has been given. 6. Having considering the matter, we are of the view that there has been an inordinate delay on the part of the respondent in initiating proceedings against the appellants for alleged violations. Much water has flown since the alleged violations and at this belated stage the appellants cannot be penalized. It is alleged that disclosure under PIT Regulations was not made but simi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law has been consistently reiterated by the Supreme Court in Bhavnagar University v. Palitana Sugar Mill (2004) Vol.12 SCC 670, State of Punjab vs. Bhatinda District Coop. Milk P. Union Ltd (2007) Vol.11 SCC 363 and Joint Collector Ranga Reddy Dist. Anr. vs. D. Narsing Rao Ors. (2015) Vol. 3 SCC 695. The Supreme Court recently in the case of Adjudicating Officer, SEBI vs. Bhavesh Pabari (2019) SCC Online SC 294 held: There are judgments which hold that when the period of limitation is not prescribed, such power must be exercised within a reasonable time. What would be reasonable time, would depend upon the facts and circumstances of the case, nature of the default/statute, prejudice caused, whether the third-party rights had been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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