SECURITIES AND EXCHANGE BOARD OF INDIA versus M/S. AKSHYA INFRASTRUCTURE PVT. LTD.

Citation: [2014] 13 S.C.R. 402 · Decided: 25-04-2014 · Supreme Court of India · Bench: S.S. NIJJAR · Disposal: Appeal(s) allowed

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Judgment (excerpt)

[2014] 13 S.C.R. 402 
A 
SECURITIES AND EXCHANGE BOARD OF INDIA 
V. 
M/S. AKSHYA INFRASTRUCTURE PVT.LTD. 
B 
(Civil Appeal No. 6041of2013) 
APRIL 25, 2014 
[SURINDER SINGH NIJJAR AND A. K. SIKRI, JJ.] 
c 
SEBI (Substantial Acquisition of Shares and 
Takeovers) Regulations, 1997-Regn. 27 and 11- Whether 
an open offer voluntarily made through a Public 
Announcement for purchase of shares of the target company 
can be permitted to be withdrawn at a time when the voluntary 
D open offer has become uneconomical to be performed -
Held: Plain reading of Regn. 27(1) makes it clear that no 
public offer whether it is voluntary or triggered by Regn.11 
can be withdrawn, unless it satisfies the circumstances set 
out in Regn.27(1)(b), (c) and (d)- Under Regn. 27(1)(b)(c) 
E and (d), a Public Offer, once made, can only be permitted to 
be withdrawn in circumstances which make it virtually 
impossible to perform the Public Offer - Ejusdem generis 
principle is fully applicable for the interpretation of Regn. 
27(1)(b)(c) and (d) as there is a common genus of 
F impossibility - This impossibility would not include a 
contingency where voluntary open offer once made can be 
permitted to be withdrawn on the ground that it has now 
become economically unviable - Accepting such a 
submission, would give a field day to unscrupulous elements 
G in the securities market to make Public Announcement for 
acquiring shares in the Target Company, knowing perfectly 
well that they can pull out when the prices of the shares have 
been inflated, due to the public offer - Such speculative 
H 
402 
· SEBI v. MIS. AKSHYA INFRASTRUCTURE PVT.LTD. 
403 
practices are sought to be prevented by Regn. 27(1)(b)(c) A 
and (d), that is precisely the reason why Regn. 27(1 )(a) was 
deleted. 
Allowing the appeal •. the Court 
HELD:1. The plain reading of Regulation 27(1) of 8 
the SEBI (Substantial Acquisition of Shares and 
Takeovers) Regulations, 1997 makes it clear that no 
public offer whether it is voluntary or triggered by 
Regulation 11 can be withdrawn, unless it satisfies the 
circumstances set out in Regulation 27(1 )(b), (c) and (d). C 
There can be no distinction between a triggered public 
offer and a voluntary public offer. Both have to be 
considered on an equal footing. [Para 28][420-F-H; 
421-A] 
2. Under Regulation 27(1)(b)(c) and (d), a Public 
Offer, once made, can only be permitted to be withdraY1n 
D 
in circumstances which make it virtually impossible to 
perform the Public Offer. In fact, the very purpose for 
deleting Regulation 27(1 )(a) was to remove any E 
misapprehension that an offer once made can be 
withdrawn if it becomes economically not viable. · 
[Para 31)(422-E-F] 
3. The ejusdem generis principle is fully applicable F 
forthe interpretation of Regulation 27(1)(b)(c) and (d) as 
there is a common genus of impossibility. This 
impossibility envisioned under the aforesaid regulation 
would not include a contingency where voluntary open 
offer once made can be permitted to be withdrawn on G 
the ground that it has now become economically 
unviable. Accepting such a submission, would give a 
field day to unscrupulous elements in the securities 
market to make Public Announcement for acquiring 
H 
404 
SUPREME COURT REPORTS 
[2014] 13 S.C.R. 
A shares in the Target Company, knowing perfectly well 
that they can pull out when the prices of the shares have 
been inflated, due to the public offer. Such speculative 
practices are sought to be prevented by Regulation 
27(1 )(b)(c) and (d), that is precisely the reason why 
B Regulation 27(1 )(a) was deleted. [Para 36][424-G-H; 
425-A-B] 
c 
D 
E 
Nirma Industries Ltd. & Anr. v. Securities and 
Exchange Board of India (2013) 8 SCC 20 : 2013 
(3) SCR 662 - affirmed. 
Clariant International Ltd. & Anr. v. Securities & 
Exchange Board of India (2004) 8 SCC 524 : 2004 
(3) Suppl. SCR 843 and Natwar Singh v. Director 
of Enforcement & Anr. (2010) 13 SCC 255 : 2010 
(13) SCR 99 - referred to. 
Case Law Reference: 
2013 (3) SCR 662 
affirmed 
Para 12 
2004 (3) Suppl. SCR 843 
referred to Para 16 
2010 (13) SCR 99 
referred to Para 33 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 
F 6041 of2013. 
From the judgment and order dated 19.06.2013 of the 
Securities Appellate Tribunal, Mumbai ("SAT") in Appeal No. 
3 of 2013. 
G 
C. U. Singh, Sr. Adv., Pratap Venugopal, Ms. Surekha 
H 
Raman (for M/s K. J. John & Co.), Advs. for the appellant. 
R. F. Nariman, Sr. Adv., Mayank Mishra, Ms. Ashlesh

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