Decided on May 30,2003



G.N.Bajpai, - (1.) BACKGROUND 1.1 Sh Saleem Fazelbhoy, his family members and M/s Amzel Pvt Limited (hereinafter collectively referred to as "the Acquirers") are the promoters of Amzel Automotive Limited (hereinafter referred to as "the Target company"). 1.2 The shares of the Target company are listed at The Stock Exchange , Mumbai. 1.3 From the letter dated 03.12.02 written by the Acquirers to SEBI it was observed that the Acquirers were holding 85.48% of the total paid up capital of the Target company on 20.02 97 ( i.e. the date on which SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 came into force) and in the year 1998 the Acquirers acquired 3150 shares constituting 0.52% shares of the Target company, thereby increasing their shareholding to 86% shares in the Target company.
(2.) SHOW CAUSE NOTICE A show cause notice dated 27.12.02 was issued to the Acquirers inter alia stating that : (i) The Acquirers have acquired 3150 shares representing 0.52% of the voting capital of the Target company during the year 1998. The first acquisition of 200 equity shares in this respect was made on 07.01.98 . (ii) In terms of the provisions of Regulation 11(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as 'the Regulations'), no acquirer shall acquire shares or voting rights which (taken together with shares or voting rights, if any, held by him, or by persons acting in concert with him), entitle such acquirer to exercise more than 51% of the voting rights in a company, unless such acquirer makes a public announcement to acquire shares of such company in accordance with the regulations. In view of this, the Acquirers could not have acquired any further shares, without making a public announcement. However, the Acquirers had acquired 200 equity shares on 07.01.98. (iii) Since the Acquirers had acquired the shares without complying with the requirements of the provisions of the Regulations, they have, prima-facie, violated the provisions of Regulation 11(2) of the Regulations and therefore, are liable for penal action under the Regulations and SEBI Act, 1992 (hereinafter referred to as ' the SEBI Act'). (iv) Why one or more or all action(s) under Regulation 44 and Regulation 45(6) of the Regulations and Section 11 and 11B of the SEBI Act, should not be initiated against them for violation specified above. The Acquirers submitted their reply to the abovesaid show cause notice vide their letter dated 6.01.2003.
(3.) THEREAFTER a personal hearing was granted to the Acquirers by SEBI on 14.03.03 wherein they reiterated the submissions made by them in reply to the show cause notice.;

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.