J.P.Devadhar, J. (Presiding Officer) - (1.) Misc. Application No. 63 of 2014
(2.) BY this Miscellaneous Application applicant/appellant seeks condonation of approximately 1000 days delay in filing the appeal. For the reasons set out in the Miscellaneous Application, delay is condoned. Accordingly, Miscellaneous Application is allowed with no order as to costs. Appeal No. 122 of 2014 1. Appellant herein basically seeks following two reliefs: i) Direction to the respondent to pay interest at the rate of 12% on Rs. 66,924/ - from March 1, 2005 till final disposal of appeal. ii) Direct the respondent to pay balance amount of Rs. 33,076/ - alongwith interest at the rate of 12% per annum from April 1, 2005 till final payment. 2. Facts relevant for the purpose of the present appeal are as follows: (a) Respondent No. 1 is a holding company of ISE Securities and Services Limited. ISE Securities and Services Limited ("ISS" for short) is wholly owned subsidiary of the Respondent No. 1. b) On January 18, 1999 appellant was registered as a trading member of respondent subject to depositing Base Minimum Capital amount and other charges. Appellant was also registered as a sub -broker with ISS which enabled the appellant to execute trades on NSE & BSE through the trading terminal provided by ISS. c) On April 4, 2005 terminal of appellant who was carrying on business as a sub -broker from year 1999 was deactivated as the appellant failed to maintain minimum level of net worth inspite of several reminders. d) By letters dated April 5, 2005 and April 7, 2005 appellant requested respondent to release the amounts that were deposited as Base Minimum Capital and also by way of fixed deposits. e) It is not in dispute that though the trading terminal was deactivated on April 4, 2005, trading membership of the appellant continued and in fact during the period from 2005 to 2009, appellant has paid annual fees payable to the respondent in relation to the trading membership of the appellant. With a view to transfer the above said trading membership appellant on February 9, 2009 sought prior approval from Securities and Exchange Board of India ("SEBI" for short) and on June 4, 2009 SEBI granted its approval for sale/transfer of membership of the appellant subject to conditions set out therein. f) During the period when transfer of membership application dated February 9, 2009 was being processed, appellant declined to pay annual subscription fees towards membership inter alia on ground that since transfer of trading membership is under consideration there is no question of paying annual subscription fee and further there is zero trading due to deactivation of the trading terminal. g) SEBI in its approval letter dated June 4, 2009, had specifically stated that security deposit of the appellant -transferor shall not be released by the respondent until the registration was granted to the transferee -broker. It appears that appellant could not complete sale/transfer of membership and accordingly appellant sought refund of the amount deposited as Base Minimum Capital and as fixed deposit by cancelling the membership of appellant with the respondent. However, membership of appellant could be cancelled by respondent, only after registration of appellant as sub broker of ISS was cancelled. Admittedly on receiving approval for cancellation of registration of appellant as sub broker by competent authority on September 20, 2010, ISS addressed a letter to the appellant on October 11, 2010 specifically stating therein that the cancellation process would be subject to clearing annual fees of respondent amounting to Rs. 30,826/ -. h) Thereupon, appellant on October 29, 2010 and on December 2, 2010 submitted various documents for cancellation of membership registration with the respondent, but failed to make payment towards arrears of annual subscription fees. i) Notwithstanding, non -payment of dues for the Financial Year 2009 -2010 and 2010 -2011, respondent forwarded cancellation application of the appellant to SEBI seeking their approval. By a letter dated July 20, 2011, SEBI approved cancellation of trading membership of the appellant with effect from June 29, 2011. j) Accordingly, the respondent by its letter dated August 2, 2011 intimated appellant about the cancellation of the membership of the appellant and forwarded a cheque for Rs. 66,924/ - after deducting Rs. 33,076/ - from the Base Minimum Capital deposit amount of Rs. 1 lac. Amount of Rs. 33,076/ - deducted by respondent represented Rs. 13,788/ - (inclusive of service tax) for each Financial Year 2009 -2010 and Financial Year 2010 -2011 plus interest on delayed payment of Rs. 5,500/ - (Rs. 13,788 + Rs. 13788+ Rs. 5500 = Rs. 33,076) k) After receiving cheque for Rs. 66,924/ - under protest, appellant have moved various authorities from time to time and ultimately has filed present appeal before this Tribunal seeking to challenge the amount of Rs. 33,076/ - deducted by the respondent.
(3.) MRS . Dina Parikh, appellant appearing in person submitted that on deactivating the terminal of the appellant in April 2005, business of the appellant came to stand still. Immediately thereafter on April 7, 2005 had sought refund of the amount deposited as Base Minimum Capital with the respondent. Since the said amount was not refunded, appellant met officers of respondent from time to time, however, officers of respondent instead of guiding the appellant properly went on wasting time on some pretext or the other. Since there was no transaction since April 2005, respondent is not justified in demanding annual subscription fees. It is further contended that even in the matter of refunding fixed deposit amount of Rs. 50,000/ -, ISS had declined to refund entire amount and therefore appellant had to initiate arbitration proceedings, wherein appellant has succeeded. Therefore, in respect of refund of Base Minimum Capital amount, since the respondent has unduly delayed in making refund, it is just and proper to direct the respondent to refund the amount with interest as claimed in the memorandum of appeal.;