SEBI THROUGH ITS CHAIHMAN versus ROOFIT INDUSTRIES LTD.

Citation: [2015] 12 S.C.R. 190 · Decided: 26-11-2015 · Supreme Court of India · Bench: VIKRAMAJIT SEN · Disposal: Appeal(s) allowed

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Judgment (excerpt)

A 
B 
[2015] 12 S.C.R. 190 
SEBI THROUGH ITS CHAIHMAN 
. v. 
ROOFITINDUSTRIES LTD. 
(Civil Appeal Nos.1364-1365 of 2005) 
NOVEMBER 26, 2015 
[VIKRAMAJIT SEN AND SHIVA KIRTI SINGH, JJ.] 
Securities and Exchange Board of India Act, 1992 - s. 
c 15A - Allegations of share-price rigging by respondent -
Issuance of summons on 23. 07. 2002 by appellant to 
respondent requiring it to produce certain documents -
However, non-compliance of summons and information 
required not provided by respondent till the extended date-
D 16.9.2002 - In terms of amended s. 15A(a}, Adjudicating 
Officer imposed penalty of Rs 1 crore on respondent and in 
connected appeal imposed Rs 75,00,000- Tribunal reduced 
the penalty payable by respondent uls. 15A from Rs 1 crore 
to Rs 60, 0001- and from Rs 75, 00, 000 to Rs 15, 000 and Rs 
E 60,000!- On appeal, held: Date on which the failure occurred 
was relevant not the date on which the penalty was imposed, 
to apply amended s. 15A - Respondent failed to furnish the 
information by the extended date, thus the failure was 
complete on 16.9.2002, resulting in penalty prior to the 
F amendmenttos. 15A becoming applicable, i.e. Rs. 1.5 lakhs 
- Order passed by the tribunal set aside. 
Allowing the appeals, the Court 
G 
HELD: The amendment to Section 15A of the 
Securities and Exchange Board of India Act, 1992 did 
not indicate that the amended Section would apply to ... 
penalties imposed after 29.10.2002. The amendment was 
merely made with effect from that date, indicating that 
H the change would be applicable for failures occurring 
190 
SEBI THROUGH ITS CHAIRMAN v. ROOFIT INDUSTRIES 191 
LTD. 
after that date. The date on which the failure occurred A 
was thus relevant for deciding the applicable law, not 
the date on which the penalty was imposed. The relevant 
version of the Act to consider would therefore, be that 
before 29.10.2002, the language of which did not indicate 
a legislative intent to consider the default a continuing B 
one. The default was clearly complete on the failure to 
submit the requisite information by the date set by the 
appellant, i.e. 16.9.2002, resulting in the penalty u/s. 15A 
becoming applicable, i.e. Rs. 1.5 lakhs. Had the 
respondent furnished the information sought by the C 
appellant by that date, undoubtedly there would have 
been no culpability against it. Thus, the penalty first 
became applicable under the pre-amendment Section, 
which imposed "a penalty not exceeding Rs. 1.5 lakhs D 
for each such failure". The intention of the Section as. it 
then stood was clearly not to consider it a continuing 
default. Such an intention can be read into the provision 
as it currently stands, as it imposes a penalty for each 
d~y for which the breach continues, but this was not the E 
case prior to 29.10.2002. Facially, this was the reason 
and necessity for the amendment. As the failure was 
complete on 16.9.2002, the penalty to be imposed on the 
respondents is Rs. 1.5 lakhs. The judgment of the SAT 
is set aside. [Para 7, 8, 10, 11) [199-B, F-H; 200-H; 201-A-
F 
DJ 
State of Bihar v. Deokar:an Nenshi 1973 
(3) SCR 1004: (1972) 2 sec 890 - relied on. 
Maya Rani Punj vs Commissioner of Income Tax, 
Delhi 1985 (3) Suppl. SCR 827: (1986) 1 sec 
445 - distinguished. 
Chitturi Subbanna vs Kudapa Subbanna (1965) 
2 SCR 661 - referred to. 
G 
H 
192 
SUPREME COURT REPORTS 
(2015) 12 S.C.R. 
A 
Black's Law Dictionary- referred to. 
Case Law Reference 
(1965) 2 SCR 661 
referred to. 
1985 (3) Suppl. SCR 827 distinguished. 
B 1973 (3) SCR 1004 · 
relied on. 
Para 6 
Para 8, 9 
Para 10 
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 
1364-1365 of 2005 
From the Judgment and Order dated 09.08.2004 of the 
C Securities Appellate Tribunal, Mumbai in Appeal No. 92 of 
2004 
WITH 
D 
C. A. NOS. 1366-1367, 1368-1369, 1370-1371, 1372-
1373, 1374-1375, 1376-1377, 1378-1379 OF 2005 
Arvind P. Datar, Pratap Venugopal, Gaurav Nair, Niharika, 
Surekha Raman, Anuj Sarma, M/s. K. J. John & Co. for 
E Appellant. 
F 
Jayant Bhushan, Shridhar Y. Chitale, Varun Mohan, 
Abhijat P. Medh for the Respondent. 
The Judgment of the Court was delivered by 
VIKRAMAJIT SEN, J. 1. These Appeals lay siege to 
the decision of the Securities Appellate Tribunal (SAT) which 
modified the order of the Adjudicating Officer under SEBI, 
reducing the penalty payable by the Respondent, Roofit 
G Industries Ltd., under Section 15A of the Securities And 
Exchange Board of India Act, 1992 (SEBIAct) from Rs. 1 cror

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