SC asks SAT to hear pleas, imposes cost on cos

New Delhi: The Supreme Court on Monday asked Securities Appellate Tribunal to hear the appeals of various companies on which market regulator SEBI had imposed fine of Rs 1 crore each for withholding information in alleged price rigging of the shares of Shonkh Technologies.

A bench headed by Justice Tarun Chatterjee while imposing costs of Rs 1 lakh and above on each company asked SAT, which had earlier dismissed the pleas on ground of delay, to hear the appeals on merit.

Firms such as Noted Infotech, Spectrum Com, DKG Buildcon, Zodiac.com Solutions and R C Gupta & Co had challenged SEBI's direction imposing a penalty of Rs 1 crore each for not complying with its summons, thus withholding information during investigation.

SEBI, which was investigating into the alleged price rigging and market manipulation of the scrip of Shonkh Technologies, had sought information from these companies. However, the appellants did not comply with the summons and had allegedly withheld information, SEBI counsel Anip Sachthey said.

Senior counsel C A Sundaram, appearing for the companies, had argued that the penalty of Rs 1 crore was harsh and burdensome. It also violated Section 15J of SEBI Act 1992 which envisages the penalty must be calculated on the basis of disproportionate gain as a result of default, he said.

The maximum penalty which could be imposed as per the law was Rs 1.50 lakh, he added. SEBI said the penalty was imposed keeping in view their conduct in withholding information on manipulations of scrips of Shonkh Technologies.