Bikash Kumar Jain vs Securities And Exchange Board Of India

Tarun Agarwala, Presiding Officer

The present appeal has been filed by the appellant against an order dated September 20, 2022 passed by the Adjudicating Officer (“AO” for convenience) of the Securities and Exchange Board of India (“SEBI” for convenience) imposing a penalty of Rs. 14 lakhs for contravening various provisions of the securities laws.

There is a delay of 188 days in the filing of the appeal. Accordingly, an application for condonation of delay has also been filed contending that the certified copy of the impugned order was never served upon the appellant and that he came to know about the impugned order through an advocate connected with SEBI who gathered the information through his own sources. It was further stated that on March 08, 2023 the applicants’ counsel wrote an email to SEBI for providing a certified copy of the impugned order and the same was received by the appellant on March 25, 2023. It was therefore urged, that the delay is genuine and the same may be condoned.

The delay application was opposed by the respondent. An affidavit to this extent has been filed indicating that the digitally signed copy of the impugned order dated September 20, 2022 was sent to the appellant at the email address provided by him, namely, nksinghcorporatestudies@gmail.com by email dated September 21, 2022. It was also urged by the respondent that before the AO the appellant had given the details of the contact person, namely, Navin Kumar Singh and the email ID was also provided. The respondent thus contended, that the digitally signed copy of the impugned order was sent by email at email ID provided by the appellant himself quite apart from the fact that the original copy of the impugned order was also sent by speed post acknowledgement due which was also served.

In response to the said affidavit, the learned counsel for the appellant contended that under Rule 7 of the SEBI (Procedure For Holding Inquiry And Imposing Penalties By Adjudicating Officer) Rules, 1995 an order is required to be served on the person by delivering it to that person or his duly authorised agent. The learned counsel contended that the impugned order was sent to the contact person provided by him but the impugned order under Rule 7 is required to be served either to the appellant or to his duly authorised agent. It was contended that the service was not made to the appellant and, therefore there was no proper service in the eyes of law.

Having heard the learned counsel for the appellant, we find that admittedly the appellant had given the email ID of the contact person. The impugned order was served at the email ID provided by the appellant. The impugned order was sent at this email ID which is not disputed by the appellant. The appellant himself provided the details of the contact person. This was essential for the purpose of the respondent intimating any orders or notices to the contact person during the course of the adjudication proceedings.

In our opinion, service of the impugned order on the contact details provided by the appellant is sufficient service as per Rule 7 of the Rules 1995.

Since the appellant was served with the impugned order through email the contention that he was not served with the impugned order cannot be believed. We find that there is an inordinate delay in the filing of the appeal for which no sufficient cause has been shown.

In Basawaraj and Anr. vs. Special Land Acquisition Officer, (2013) 14 SCC 81 the Supreme Court held that the discretion to condone the delay has to be exercised judicially based on facts and circumstances of each case and that sufficient cause cannot be given a liberal interpretation if lack of bonafide is attributed to a party. The Supreme Court further held that delay cannot be condoned on equitable ground beyond the limits permitted expressly by statute.

The Supreme Court in Ram Nath Sao and Ors. (supra) held that the expression “sufficient cause” should receive a liberal construction so as to advance substantial justice when no negligence or inaction or want of bonafide is imputable to a party. The same view was reiterated by the Supreme Court in Madanlal vs. Shyamlal, (2002) 1 SCC 535.

In Balwant Singh (Dead) vs Jagdish Singh & Ors. (2010) 8 SCC 685 Supreme Court held that the expression “sufficient cause” means the presence of legal and adequate reasons. The decisions cited by the learned counsel for the appellant are of no avail and, in any case, not applicable in the present circumstance of the case.

This Tribunal is possessed with the exercise of judicial discretion in condoning the delay if sufficient or adequate reason is given. It is also a settled proposition of law that the law of limitation may harshly affect a particular party but it has to be applied with all its rigour when the statute so prescribes. The court has no power to extend the period of limitation on equitable grounds as held by the Supreme Court in Basawaraj and Anr. (supra). In the instant case, we do not find any legal or adequate reasons to condone the delay.

For the reasons stated aforesaid, the application for condonation of delay lacks merit and consequently the application is rejected, as a result of which the appeal is also dismissed with no order as to costs.