BEFORE THE SECURITIES APPELLATE TRIBUNAL MUMBAI Date of Hearing : 25.03.2019 Date of Decision : 28.03.2019 Misc. Application No. 46 of 2017 In Appeal No. 58 of 2016 Prebon Yamane (India) Ltd. 4th Floor, Kalpataru Heritage, 127, M. G. Road, ….. Applicant Fort, Mumbai – 400 001. (Org. Appellant) Versus Securities and Exchange Board of India SEBI Bhavan, Plot No. C-4A, G Block, Bandra Kurla Complex, Bandra (East), …… Respondent Mumbai – 400 051. (Org. Respondent) Mr. Somasekhar Sundaresan, Advocate with Mr. Abishek Venkataraman, Mr. Pulkit Sukhramani, Ms. Stuti Shah, Advocates i/b J. Sagar Associates for the Applicant. Mr. Mustafa Doctor, Senior Advocate with Mr. Abhiraj Arora, Mr. Vivek Shah, Advocates for the Respondent. CORAM : Justice Tarun Agarwala, Presiding Officer Dr. C. K. G. Nair, Member Justice M. T. Joshi, Judicial Member Per : Justice Tarun Agarwala, Presiding Officer

1. The relevant facts for disposal of this Misc. Application is that

in 2004 SEBI raised demand of Rs. 4,64,17,206/- towards principal amount and interest under Securities and Exchange Board of India (Interest Regularization Scheme 2003) as fees under the Brokers Regulations. The said demand was challenged by the appellant before this Tribunal which was allowed by an order dated August 17, 2005 and SEBI was directed to refund the aforesaid amount which had already been paid by the appellant. The order of the Tribunal was challenged by SEBI before the Hon’ble Supreme Court of India. During pendency of the appeal, the Hon’ble Supreme Court permitted the appellant to withdraw the amount deposited with this Tribunal. Consequently, the appellant withdrew a sum of Rs. 6,20,12,878/- towards principal amount and interest accrued thereon. The Hon’ble Supreme Court eventually allowed the appeal by a judgment dated December 16, 2005 and the order of the Tribunal was set aside. Consequently, the demand raised by SEBI in 2004 was affirmed and the amount became payable alongwith interest.

2. SEBI, accordingly, vide letter dated December 8, 2015 called

upon the appellant to pay a sum of Rs. 11,59,57,867/-. In response the appellant informed vide letter dated December 30, 2015 that the appellant is liable to pay a sum of Rs. 6,20,12,878/- alongwith simple interest, and accordingly, deposited a sum of Rs. 8,15,11,450/- towards the principal amount and interest accrued thereon. SEBI informed vide letter dated February 4, 2016 that the appellant was liable to pay a balance amount towards interest amounting to Rs. 1,09,65,164/-. Accordingly, Appeal No. 58 of 2016 was filed by the appellant. The Tribunal by order dated June 6, 2016 held that SEBI was not entitled to charge compound interest and that the appellant was liable to pay simple interest on the amount withdrawn at relevant bank rate / rates prevailing from time to time.

3. Based on the order of the Tribunal dated June 6, 2016, the

appellant calculated simple interest on the entire amount of Rs. 6,20,12,878/- and deposited an additional amount of Rs. 56,60,819/- vide letter dated June 10, 2016. SEBI vide letter dated August 31, 2016 intimated the appellant that the appellant is required to pay an additional amount of Rs. 39,03,155/-.

4. Since there was a conflict of calculation of rate of interest, the

appellant has filed the present misc. Application for certain clarification.

5. Having heard Shri Somasekhar Sundaresan, the learned counsel

for the appellant and Shri Mustafa Doctor, the learned senior counsel for the respondent, we find that parties are not clear as to how simple interest at relevant bank rate is to be calculated. The contention of the respondent is that interest has to be calculated as per lending rates given by the Reserve Bank of India or fixed deposits rates as prescribed by the Scheduled Banks.

6. Having given our thoughtful consideration in the matter, we

are of the opinion that the matter must come to an end and a finality must be reached. Simple interest was required to be calculated which the parties have failed to calculate in the correct perspective. We find that admittedly, the appellant has paid an additional amount of Rs. 56,60,819/- towards interest. Without going into the mechanics of exact calculation, we find it appropriate in the interest of justice to direct the appellant to deposit a further sum of Rs. Ten lacs on or before April 30, 2019.

7. We, accordingly, dispose of the Misc. Application No. 46 of

2017 directing that in the event the appellant deposits a further sum of Rs. Ten lacs on or before April 30, 2019, the matter would come to an end finally. In the event of default, it would be open to the respondent to recover the entire amount as stipulated by them vide their letter dated August 31, 2016. Sd/- Justice Tarun Agarwala Presiding Officer Sd/- Dr. C. K. G. Nair Member Sd/- Justice M. T. Joshi Judicial Member 28.03.2019 Prepared & Compared by PTM