BEFORE THE SECURITIES APPELLATE TRIBUNAL MUMBAI Date:24.12.2020 Misc. Application No.535 of 2020 And Misc. Application No.536 of 2020 And Appeal No.499 of 2020 Alpana R. Kirloskar & Ors. …Appellants Versus Securities and Exchange Board of India …Respondent Mr. Darius Khambata, Senior Advocate with Mr. Pheroze Mehta, Advocate i/b. Tushar Ajinkya, Advocate for the Appellants. Mr. Shiraj Rustomjee, Senior Advocate with Mr. Mihir Mody and Mr. Arnav Misra, Advocates i/b. K. Ashar & Co. for the Respondent. Order:

1. The appellants are aggrieved by the order of the

Whole Time Member (‘WTM’ for short) by which they have been restrained from accessing the securities market for a period of six months. The appellants have also been directed to disgorge certain amounts and penalties on the charge of selling the shares of Kirloskar Brothers Ltd. to Kirloskar Industries Ltd. (hereinafter referred to as ‘KIL’) as a block deal on the stock exchange platform in the year 2010. The allegation is that they have sold these shares while in possession of unpublished price sensitive information.

2. In pursuance to the impugned order the bank

accounts and the demat accounts of the appellants have been frozen.

3. Having heard the learned senior counsel for the

parties we find that a number of issues arises for consideration and some of them are whether there was an inordinate delay in the issuance of the show cause notice especially when the trades were done on the stock exchange platform. Further, whether the transfer of the shares is in violation of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 and whether the direction to pay interest from the date of the transfer was justified.

4. In the light of the aforesaid, we direct the respondent

to file a reply within six weeks from today. Three weeks thereafter to the appellant to file rejoinder. The matter would be listed for admission and for final hearing on 2nd March, 2021.

5. It was urged that the impugned order should be

stayed subject to the undertaking given by the appellants. On the other hand, the learned senior counsel for SEBI contended that the appellants should be put to terms and should be directed to deposit a certain amount in cash. Considering the fact that there appears to be a delay in the issuance of the show cause notice we are of the opinion that the undertaking given by the appellants would protect interest of the respondent.

6. We, consequently, stay the effect and operation of

the impugned order provided the appellant nos.1, 2, 4 and 5 will not sell their shares in KIL to the value of Rs.10 crores each and appellant no.3 will not sell its shares in KIL to the value of Rs.20 crores each. The undertaking given by the appellants before this Tribunal will also be given to the depository to ensure compliance. In case of any deviation it would be open to SEBI to move an application for modification or vacation of this order.

7. Parties are directed to contact the Registrar 48 hours

before the date fixed to find out as to whether the hearing would take place through video conferencing or through physical hearing.

8. The present matter was heard through video

conference due to Covid-19 pandemic. At this stage it is not possible to sign a copy of this order nor a certified copy of this order could be issued by the registry. In these circumstances, this order will be digitally signed by the Private Secretary on behalf of the bench and all concerned parties are directed to act on the digitally signed copy of this order. Parties will act on production of a digitally signed copy sent by fax and/or email. Justice Tarun Agarwala RAJALAKSH DigitallyRAJALAKSHMIsignedHbyNAIR Presiding Officer MI H NAIR Date:15:34:282020.12.28+05'30' Dr. C.K.G. Nair Member Justice M.T. Joshi Judicial Member 24.12.2020 RHN