Company Application No. 1613/2015 in C.P. No. 177/2013. Case: B & A Packaging (India) Limited Vs Amrex Marketing Private Limited and Ors.. Company Law Board

Case Number:Company Application No. 1613/2015 in C.P. No. 177/2013
Party Name:B & A Packaging (India) Limited Vs Amrex Marketing Private Limited and Ors.
Counsel:For Appellant: Ratnanko Banerjee, Sr. Adv., Anirban Ray, Ratnesh Rai, K. Mallick and Anumoy Basu, Advs. and For Respondents: Arvind Parasramka, Adv.
Judges:V.P. Singh, Member (J) and S. Vijayaraghavan, Member (T)
Issue:Securities And Exchange Board Of India Act, 1992 - Sections 15A(b), 15Y
Judgement Date:January 17, 2017
Court:Company Law Board


S. Vijayaraghavan, Member (T), (Kolkata Bench)

  1. This company application 1613/2015 has been filed by the respondent/applicant in C.P. No. 177/2013. This is a company registered under the Companies Act, 1956 having its headquarters in Bhubaneswar, Odisha The authorised share capital of the company is Rs. 8 crores divided into 80 lakhs equity shares of Rs. 10/- each and with a paid up capital of Rs. 4,96,05,000/- divided into 49,60,500/- equity shares of Rs. 10/- each fully paid up.

  2. Brief facts of the case as stated by the petitioner are given below The respondent Nos. 1 and 2 acting in concert and have purported to acquire shares in excess of 7% in the company in violation of Security Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 2011. The respondent No. 1 had initially acquired 1,20,500 shares of the company representing approximately 2.5% of the total paid up share capital. The respondent No. 2 thereafter acquired 2,41,000 equity shares of Rs. 10/- each fully paid up representing 4.86% of the total paid up shares of the company. Thus, the combined holding of the respondent Nos. 1 and 2 is about 7.3% shares which is in excess of the prescribed limit of 5% as specified in the SAST Regulations. The petitioners have stated that the information which is mandatory to be provided under the Regulations was not provided to the company and hence it was done without the knowledge of the company in violation to the SEBI Regulations. The petitioners have further stated that 400 shares were transferred by the respondent No. 1 in favour of the respondent Nos. 3,4,5 and 6 on 10th May, 2012 and these were approved by the Share Transfer Committee meeting held on 31st May. 2012. Here again, no disclosure has been made. The respondent No. 1 further acquired 12,400 shares in the company from off market deals on or about 2nd November. 2012 This acquisition of shares was however disclosed The respondent no 1 had lodged for transfer of 6900, 900 and 1100 shares and transfers were approved by the share transfer committee of the petitioner company on 15.11.2012, 31.12.2012 and 31.01.2013 respectively. The said transfers has been disclosed under regulation 29(1) of SEBI (Substantial Acquisition of Shares And Takeover) Regulation 2011 in compliance of Section 111A(3) of the Companies Act, 1956. The en block 3000 shares lodged by the respondent No. 1 has been held by the company for lack of certain material documents. The remaining 500 shares of the petitioner company has not been lodged for transfer by respondent No. 1 till date. The said disclosure was made on the basis of existing holding of the previously acquired shares which were not disclosed and proceeded on the basis as if the said respondent had validly acquired and was holding 7.3% shares in the company. A copy of the said disclosures under Regulation 29(1) and (2) has been annexed with the petition and marked as Annexure "A5". The violations of the SAST Regulations did not come to the light until 12 June 2013 when the petitioner company for the first time noted a complaint filed by the respondent No. 1 in the website of SEBI for investor's complaints, wherein the said respondent No. 1 had complained to SEBI in relation to non-transfer of about 3,000 shares. The matter was referred by the petitioner company to its Advocates, who upon inquiry have found out the non-compliance by the respondents of the SAST Regulations. Various correspondences exchanged in this regard and the complaint lodged in the said website of SEBI by the respondent No. 1 has been annexed with the petition and marked as Annexure 'A-6'. Such violations have accordingly come to the knowledge of the petitioner company only after June 12, 2013. Therefore, no disclosures have been made by the respondent No. 1 under the Securities Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 and in particular Regulation 13 thereof which requires mandatory disclosures to be made where the acquirer has acquired over 5% shares in the Company. The petitioner has further stated that the SEBI (Prohibition of Insider Trading) Regulation requires a specific notice under the Regulation to be issued upon any persons acting in concert in a listed company existing shareholding of 5%. The company has been advised that issuance of the intimation and/or...

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