Sebi vs Akshya Infrastructure Pvt.Ltd

3. In this case, the respondent herein, M/s Akshya Infrastructure Pvt. Ltd., is a part of the Promoter Group of MARG Limited (‘the Target Company’). For the years 2006-07, 2007-08 and 2010-11, the gross acquisition by the Promoter Group of shares in the Target Company was as under :

9. M/s. Marg Projects and Infrastructure Limited (formerly Marg Holdings and Financial Services Limited)

7. The respondent claimed that the impugned directions, ostensibly in the form of comments and observations on the draft letter of offer, reject the plea of the petitioner that the delay caused by SEBI in clearance of the draft letter of offer, now renders the open offer unviable and academic. Further, the impugned directions purport to bind the appellant and thereby constitute an order by which the respondent was aggrieved; and necessitated the appeal before the SAT.

9. The appeal was contested by the appellant by filing a detailed affidavit on 12th April, 2013. As noticed above, the aforesaid appeal has been allowed by SAT in terms of prayer clause (a),

34. All the information sought by SEBI related to the three earlier acquisitions when the creeping limit for acquisition has been breached for triggering the mandatory Takeover Regulations. In appeal, SAT has left the question with regard to the earlier three acquisitions open and to be decided in accordance with law. Therefore, clearly no prejudice has been caused to the respondent.

35. Finally, we are unable to accept the submission of Mr. Nariman that the ratio of law as declared in Nirma Industries Ltd. (supra) would not be applicable to the facts and circumstances of this case. As pointed out earlier, we do not accept the distinction sought to be made by Mr. Nariman with regard to voluntary open offer and mandatory open offer which is the result of a triggered acquisition. The consequences of both kinds of offers to acquire shares in the Target Company, at a particular price, are the same. As soon as the offer price is made public, the securities market would take the same into account in all transactions. Therefore, the withdrawal of the open offer will have to be considered by the Board in terms of Regulation 27(1)(b)(c) and (d). Further, the deletion of Regulation 27(1)(a) does not, in any manner, advance the case of the respondent. It rather reinforces the conclusion that an open offer once made can only be withdrawn in circumstances stipulated under Regulation 27(1)(b)(c) and (d). We also do not agree with Mr. Nariman that voluntary open offer made by the respondent ought to be permitted to be withdrawn under Regulation 27(1)(b) for the reasons already stated. We have already come to the conclusion that the delay in offering comments by the Board on the letter containing voluntary open offer, though undesirable, is not fatal to the decision ultimately taken by the Board. We, therefore, reiterate our conclusion in Nirma Industries (supra).

38. In view of the above, the appeal is allowed. The impugned order passed by the SAT dated 19th June, 2013 in Appeal No.3 of 2013 is set aside and the directions issued by the appellant in the letter dated 30th November, 2012 are restored.

April 25, 2014.