Legal RoundUpTribunals/Regulatory Bodies/Commissions Monthly Roundup

Armed Forces Tribunal (AFT) 

AFT denies grant of any relief to the person invalidated from service due to Alcohol Dependence Syndrome

“All efforts are made by military doctors and the organization to help a soldier who has become a victim of ‘Alcohol Dependence Syndrome’ and only when all efforts fail the soldier is invalided out on ground of ‘Alcohol Dependence Syndrome”.

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Is hypertension a disability attributable to or aggravated by Military Service? Will Invalidation make one entitled to disability pension? Tribunal decides

The Division Bench of Justice Umesh Chandra Srivastava and Vice Admiral Abhay Raghunath Karve, Member (A) granted disability pension to the person invalidated from service due to Hypertension.

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Where lesser age is recorded in school certificate than the actual age; correct date of birth will be the one recorded by the parents in service records

 Resolving a date of birth related controversy, the Division Bench of Justice Umesh Chandra Srivastava and Vice Admiral Abhay Raghunath Karve, Member (A) stated,

“If we take date of birth recorded in educational certificate of the applicant as correct i.e. 05-07-1992 and date of birth in respect of his younger brother being 20-02-1992 as per service records, one can imagine as to how it could be possible that an elder brother comes to this world later than his younger brother.”

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Central Administrative Tribunal (CAT)

 When subjective satisfaction of dispensing with the inquiry is not supported by any independent material, dispensing with holding the inquiry would be illegal

 “If a preliminary inquiry could be conducted, there may not be any reason as to why formal departmental inquiry could not have been initiated against the delinquent.”

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Competition Commission of India (CCI)

Competition Watchdog | Know why CCI imposed penalties on beer companies: Nation-wide Cartel? Read Full Report

 “No distinction in the Act, for the purposes of assessment of anti-competitive conduct, is made between the end-consumers, and intermediaries falling in the supply chain.” 

Read more…


Central Bureau of Investigation (CBI)

CBI | Does not find any fault in the coda but questions the agenda | Accepts CBI’s closure report but questions the investigation

Shivank Singh, Special Judicial Magistrate (CBI), while accepting the closure report questioned the delayed investigation by the premier investigation agency of the country. While accepting closure report, the Court stated,

“It may be noted that the collective and cogent evidence/ material gathered by CBI is enough to settle the fact that the allegations of complainant against her father and 26 other accused could not be substantiated”.

Read more…

Cremation of rights could not burn Justice on pyre | Lambasted UP Police for ‘shoddy investigation’, orders for further investigation

 “…it may be noted that there are many lapses on the part of UP Police which has hauled this case with open ends. This court is in deep pain to note that due to such lapses, the parents and family of the deceased did not even get a chance to see the dead body of the deceased or to perform the last rites of their late son”.

Read more…


Customs, Excise and Services Tax Appellate Tribunal (CESTAT)

When road construction is exempt; is every activity exempt relating to the road construction including consulting engineer services? Tribunal answers 

This Tribunal has held in other disputed cases that even the barricade provided on the side of highway, maintaining greenery on the side or middle of highway, construction of any facility, refreshment centre for road users, is also part of the road construction and such activity is also exempt. Even the administrative building constructed by the concessionaire, for construction of the road or highway for administration and collection of toll etc. is part of road.

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Recourse to revocation should be taken in extreme circumstances only and not in respect of violations for which there are other provisions to deal with them; Tribunal partly allows appeal

The Division Coram of Sulekha Beevi C.S. (Judicial Member) and P. Anjani Kumar (Technical Member) partly allowed an appeal which was filed assailing an impugned order by which the appellant customs broker’s licence was revoked on the grounds of contravention of Regulations 10(b), 10(d) and (10)(n) of the Customs Brokers Licensing Regulations, 2018; security deposit was forfeited and penalty was also imposed. 

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Amount claimed as refund already debited in Returns, whether there would be entitlement for refund under Rule 5 of CCR, 2004? Tribunal answers

P Dinesha (Judicial Member) allowed an appeal in which the Tribunal had to decide whether the appellant was entitled to refund under Rule 5 of CENVAT Credit Rules, 2004 (CCR).

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Whether the services provided by subsidiary company to its parent company in a foreign country could be treated as export of services? Tribunal answers

 Anil Choudhary (Judicial Member) allowed the appeals which were filed against the common Order-in-Appeal which dealt with the issue as to whether the services provided by the appellant to its parent company in Hong Kong, could be treated as export of services, and if the answer was in affirmative, whether the refund of amount paid under mistake of law by treating such export of services, as taxable service, could be denied by the revenue.

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Whether refund claim under R. 5 of CCR can be rejected on the ground that appellant did not debit amount of refund claimed at the time of filing refund claim, but have debited such amount subsequent to the filing of refund claim but before adjudication?

Anil Choudhary (Judicial Member) allowed an appeal which was filed bearing the issue as to whether the refund claim under Rule 5 of Cenvat Credit Rules read with Notification No.27/2012-CE (NT) can be rejected on the ground that the appellant did not debit the amount of refund claimed at the time of fling the refund claim, but have debited such amount subsequent to the filing of the refund claim but before adjudication.

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If two reasonable constructions of a taxing provision are possible, that construction which favours the assessee must be adopted; Appeal allowed

When there is a reasonable interpretation of a legal and factual situation, which is favourable to the assessee, such an interpretation is to be adopted.

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National Company Law Tribunal (NCLT)

Deducing from the acts and the tactics of the corporate debtor failing the test of legality, initiates CIRP

The Coram of Ashok Kumar Borah, Judicial Member, and Shyam Babu Gautam, Technical Member while allowing the company petition, ordered for initiation of Corporate Insolvency Resolution Process (CIRP). The Bench stated that,

“The Operational Creditor has successfully demonstrated and proved the debt and default in this case and has also proved that there is absolutely no reason for the Corporate Debtor to hold on to the payment of the invoices”.

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Debit acknowledged in emails, CIRP initiated resultantly-Appoints IRPM and declares moratorium

The Coram of P.S.N Prasad, Judicial Member and Narender Kumar Bhola,  Technical Member were inclined to allow the process of CIRP, considering the debt acknowledged by the corporate debtor.

Read more…


National Company Law and Appellate Tribunal (NCLAT)

NCLAT| Finds raising a late ‘pre-existing dispute’, spurious and to avoid action under IBC| Denies to stay CIRP 

The Coram of Justice Jarat Kumar Jain and Alok Srivastava, Technical Member while deciding an appeal denied to put a stay on the CIRP proceedings. The Tribunal was of the opinion that the alleged ‘pre-existing-dispute’ was raised at such a late stage even though it was a spurious dispute, only with an intention to avoid action under IBC. The Tribunal further made it clear that the order will not have any effect on the final outcome.

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Securities Exchange Board of India (SEBI)

SEBI | Monotonous modus operandi, modulated endgame |Issue of GDR, artificial arrangement, supported by the subscribing Company itself-Restrained and to disgorge

“It appears that the whole series of GDR issues by several listed companies in India was an act orchestrated by Arun Panchariya to reap benefits by sitting on the other side of the issuance and subscribing to the GDRs through an arrangement with Vintage. The respective Indian companies have also apparently participated in such schemes. Accordingly, as brought in the foregoing paragraphs, in view of the repetitive nature of such acts along with the gravity of the offences that have been perpetrated by Arun Panchariya, I am of the considered opinion that stern measures need to be taken against him and his connected entities”. 

Read more …

“Pandya ka Sauda” turns out to be the “Aakhri Sauda” for anchor and 5 other entities for the fraudulent trade activity-Ex parte interim order

 The balance of convenience is to impose suitable directions against the aforesaid entities so as to maintain a level playing field in the market for the general investors. If an ex-parte order is passed, what is at stake is right of the current entities herein vis-a-vis multitude of investors in the market. It may be noted that one of the underlying differences between the ex-parte orders in the case of private suits and ex-parte public enforcement actions, is the identification of the injured party. In private damage suits, the injured individual, as “whole”, is identifiable whereas ex-parte public enforcement actions, seek to protect the floating multitude of investing public by preventing, continuous and imminent violations of the securities laws.

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GDR| Catches the principal architect in activation & orchestration of the fraudulent scheme –Leaves one being ‘under liquidation’, rest restrained from accessing the market

G Mahalingam, Whole Time Member, restricted the entities from the securities market, involved in the fraudulent issuance of GDRs without appropriate disclosures.

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Calibrated efforts cancelling out the chance of coincidence of matching trades in illiquid scrip does not go scot free-Restricted from the market for manipulation

 Madhabi Puri Buch, Whole Time Member, while exercising powers under Section 19 read with Sections 11(1), 11(4) and 11B (1) and 11B(2) of the Securities and Exchange Board of India Act, 1992 restricted the Noticees involved in manipulation of the scrip.

Read more…

Tribunals/Regulatory Bodies/Commissions Monthly Roundup

Here’s a run-through of all the significant decisions covered in the month of July, 2021 under the Section of Tribunals/Commission/Regulatory Bodies.


Appellate Tribunal for Electricity

 

Solar Project

Whether there was bona fide delay in commissioning the solar power project?

“…allowed an appeal which was filed against the Order of Karnataka Electricity Regulatory Commission (Commission) whereby, the Commission has held that the Applicant/Appellant was not entitled to extension of time for commissioning of solar power project in terms of the Power Purchase Agreement and Supplementary power Purchase Agreement.”

Read more: https://bit.ly/3jbKtvP


Armed Forces Tribunal

War Injury Pension

Tribunal grants war injury pension to WW-2 soldier who suffered splinter wound injury in Italy

“…war injury pension to World War-2 veteran who suffered splinter wound injury in his right leg”

Read more: https://bit.ly/37cxXXi


Customs Excise & Service Tax Appellate Tribunal

Input Services

Whether distribution of credits on input services attributable to final product on a pro-rata basis proportionate to turnover of each unit between manufacturing plants? Tribunal answers

“…issue involved was that the appeals was whether Parle Biscuits was justified in distributing credits on input services attributable to the final product on a pro-rata basis proportionate to the turnover of each unit between the manufacturing plants of Parle Biscuits and its contract manufacturing units, including Krishna Foods, under Rule 7(d) of the CENVAT Rules.”

Read more: https://bit.ly/2V5CYhG

Convenience Fee

“Convenience fee” charged by PVR for online booking of movie tickets under OIDAR category under S. 65(105) (zh) of Finance Act taxable or not? Tribunal explains

“Issue involved was related to to taxability of “convenience fee” charged by PVR Limited on its customers for online booking of movie tickets under the category of “online information and database access retrieval system” defined under section 65 (75) of the Finance Act and taxable under section 65 (105)(zh) of the Finance Act.” 

Read more: https://bit.ly/3rKRvvg

Principles of Natural Justice

Revenue has miserably failed to discharge its onus; Tribunal finds impugned order opposed to principles of natural justice

https://bit.ly/37a5uB8

CENVAT Credit

Admissibility of the Cenvat Credit in respect of outward GTA; Tribunal allows appeal

https://bit.ly/3xcJKzf


Central Information Commission

Right to Information Act

Can S. 8(1)(d), RTI Act be invoked to deny copy of thesis in view of commercial viability and to protect interests of scholar and his guide?

“…thesis publication of the research scholars cannot be reasonably even brought under any of the suo motu components of disclosure envisaged under Section 4 of the RTI Act, thereby reinforcing the proposition that the protection of Section 8 and 9 exemptions is very much available to the CPIO in the instant case.”

Read more: https://bit.ly/3fbpI23


Delhi State Consumer Disputes Redressal Commission

 

Deficiency of Service

Will Camera Manufacturer — Nikon be liable for deficiency of service caused to a consumer who lost all his photographs due to memory card getting corrupted?

“…Nikon was neither the manufacturer, dealer, importer, wholesaler of the Memory Card which got corrupted leading to the loss of the photos.”

Read more: https://bit.ly/3fbqg87

Builder-Buyer Dispute

Builder handing over possession of plot with incomplete development beyond agreed time. Is buyer entitled to refund of deposit with interest? Commission decides

“Possession of the plot land booked by the complainant was not handed over within the time agreed to despite the complainant has made the payment to the extent sought from time to time.”

Read more: https://bit.ly/2WJUV6d


National Consumer Disputes Redressal Commission

Medical Negligence

  • Can Wheelchair injuries be covered under the ambit of medical negligence?

“Wheelchairs are usually thought of a medical device that is meant to help those who are injured or have physical challenges; they can also be a source of injury when not properly used. Most wheelchair injuries that happen in a medical setting due to the negligence of medical staff and such could be easily prevented by a hospital or nursing home.”

Read more: https://bit.ly/3fimrOy

  • In case a medical practitioner chooses to follow one procedure instead of another, which turned out to be a failure, Can the said act be negligent?

“…The medical professional is often called upon to adopt a procedure that involves a higher element of risk, but which he honestly believes as providing greater chances of success for the patient rather than a procedure involving lesser risk but higher chances of failure.”

Read more: https://bit.ly/3idk4hG


National Company Law Appellate Tribunal

 

Insolvency Proceedings

An Arroyo for OYO | While allowing it to work independently, closed insolvency proceedings; Disallowed external parties to impinge

“We are of the considered view that before Constitution of Committee of Creditors (CoC) mere filing of a ‘Claim’ does not constitute a default per se. It is only on the basis of the ‘Claims’ that the CoC is constituted. In a catena of Judgments, the Supreme Court has reiterated that the prime objective of the Court is not recovery, but revival”.

Read more: https://bit.ly/3rO12BU


National Company Law Tribunal

Personal Guarantor

Personal Guarantor not liable to be prosecuted under S. 95 IBC where corporate debtor concerned is not under corporate insolvency resolution process

https://bit.ly/2Vmxnn0


National Green Tribunal

No Odour control system required to prevent odour from Sewage Treatment Plant. Why? NGT imposes costs on Delhi Jal Board: Why DJB is shirking its responsibility?

Mere spraying of chemical solution and other superficial steps is not effective in installing an effective odour control unit.”

Read more: https://bit.ly/3rMxOTD


National Human Rights Commission

Fr. Stan Swamy | Medical Treatment

  • Ensure every possible medical treatment to imprisoned FR. Stan Swamy as part of life saving measure and protection of his basic human rights: NHRC

https://bit.ly/3yk7ov5

Manual Scavenging

  • Manual scavenging and hazardous cleaning still remain a stinking truth of our nation: NHRC

https://bit.ly/3yi3seb

Post-Poll Violence in West Bengal

  • NHRC refutes allegations in a section of media regarding leakage of report relating to post poll violence in West Bengal

https://bit.ly/3BZMT9h


Securities Exchange Board of India

Fraudulent Scheme

 Manipulation in prices, fraudulent scheme results in debarment-Global Infratech, Directors and 12 other entities ousted from the market

https://www.scconline.com/blog/post/2021/07/23/manipulation-in-prices/

Insider Trading

Financial Racket: Kundra, Shetty into murky waters again | Imposes fine for insider trading on Viaan Industries

https://bit.ly/2V0zFZq


 Securities Appellate Tribunal

 

Collective Investment Scheme

Unregistered Collective Investment Scheme violative of S. 12(1)(b) of SEBI Act and Regulations, order to pay 10% p.a. interest on refundable amount not vitiated

https://bit.ly/3j728EJ


Tribunals/Regulatory Bodies/Commissions Monthly Roundup | June 2021

Tribunals/Regulatory Bodies/Commissions Monthly Roundup

Here’s a run-through of all the significant decisions covered in the month of June, 2021 under the Section of Tribunals/Commission/Regulatory Bodies.


Armed Forces Tribunal

♦ AFT | Pension cannot be denied for disability being less than 20% where the disability is assessed at 15-19%“

The assessment of disability to the tune of 15-19% itself is a doubtful assessment and cannot be final for the simple reason that there is no barometer which can assess the disability percentage to the extent of 1% and therefore, the percentage of disability which has been assessed as 15-19% may be 20% also and there may be variation of at least two percent plus also. In case of doubt as the benefit should always be given to the applicant.”

https://wp.me/scenps-pension


Competition Commission of India

♦ CCI examines if airlines were involved in cartelization resulting in anti-competitive practice during Jat Agitation in 2016 || Synoptic view of Judgment

“…with the use of algorithms, there exists a high possibility of collusion with or without the need of human intervention or coordination between competitors.”

https://wp.me/pcenps-130u

♦ ABFI prohibits State Baseball Associations from joining unrecognised leagues, threatens disciplinary action | CCI to examine such conduct in light of provisions of Competition Act

“ABFI isued communication to its affiliated State Baseball Association requested them no to entertain unrecognized bodies and further by requesting them not to allow their respective State players to participate in any of the tournaments organized by such unrecognized bodies, has violated the provisions of Section 4(2)(c) of the Act as it resulted in denial of market access to other federations.”

https://wp.me/pcenps-130J

♦ CCI | Did Google leverage dominance in Play Store? Director-General to conduct investigation in complaint by smart phone/smart TV users

“..by making pre-installation of Google’s proprietary apps conditional upon signing of ACC for all android devices manufactured/distributed/marketed by device manufacturers, Google has reduced the ability and incentive of device manufacturers to develop and sell devices operating on alternative versions of Android and thereby limited technical or scientific development relating to goods or services to the prejudice of consumers in contravention of Section 4(2)(b) of the Act.”

https://wp.me/scenps-google

♦ Are Tourist Taxi Unions in State of Goa preventing entry of App-based Taxi Aggregator Companies in Goa? Read a detailed account of CCI’s decision

“..despite the opposition of taxi unions, the State of Goa does not appear to have acceded to or conceded to the demands of the OPs and the policy allowing entry of app based taxi aggregators was eventually notified.”

https://wp.me/pcenps-13au

♦ CCI | Co-location facility of National Stock Exchange is anti-competitive? Is the service an autocratic move against traders? Comprehensive Report

A robust exchange acts as a backbone of the financial system and the provision of co-location facility by exchanges help increase volumes of trades manifold and provides liquidity to investors. This augurs well for the market, the companies and the economy.

https://wp.me/pcenps-13aA


Customs, Excise and Services Tax Appellate Tribunal

♦ CESTAT | Assessable Value to include Advertising and Marketing Costs, if relatable to Imported Goods; Tribunal provides relief to Volvo Auto India

https://wp.me/pcenps-1312


Income Tax Appellate Tribunal

♦ ITAT | Whether DTAA protection in respect of taxation of dividend in source jurisdiction, can be extended to ‘dividend distribution tax’ under S. 115-O, Income Tax Act, in the hands of a domestic company? Matter referred to larger Bench

“Whether the protection granted by the tax treaties, under Section 90 of the Income Tax Act, 1961, in respect of taxation of dividend in the source jurisdiction, can be extended, even in the absence of a specific treaty provision to that effect, to the dividend distribution tax under Section 115-O in the hands of a domestic company?”

https://wp.me/scenps-taxation


National Consumer Disputes Redressal Commission

♦ NCDRC | In a case of death insurance claim, can police investigation be replaced by private agency investigation engaged by insurance company? Commission spells out

Inquest is conducted as mandated under the Cr.P.C., Post Mortem is conducted by the concerned government Medical Officer, Investigation is conducted by the Police (a private agency engaged by the Insurance Co. does not substitute for the Police).

https://wp.me/pcenps-12Zd

♦ NCDRC | Builder unilaterally, high-handedly cancels sale agreement on not handing over timely possession: Commission decides builder-buyer dispute, levies interest to be paid by builder

“According to Section 8 of the Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963, if the builder is not able to hand over the possession over the building/flat within the time specified in the agreement then the builder is liable to pay interest to the purchaser of the flat for the period for which the possession has not been handed over.”

https://wp.me/pcenps-139u


National Company Law Appellate Tribunal

NCLAT | Can Banks debit amounts from Corporate Debtor Company after Moratorium Order? Is there an obligation of releasing ‘title deeds’ under Resolution Process? Read on

Banks cannot freeze accounts, nor can they prohibit the ‘Corporate Debtor’ from withdrawing the amount as available on the date of the moratorium for its day-to-day functioning.

https://wp.me/pcenps-12UG


Real Estate Regulatory Authorities

Rajasthan Real Estate Regulatory Authority, Jaipur

♦ Is S. 13 of RERA Act a mandatory requirement? Can promoter demand cost of plot more than 10% before registering sale agreement? | Raj RERA decides

https://wp.me/scenps-rera

Maharashtra Real Estate Regulatory Authority, Mumbai

♦ Can promoter/builder sell covered car parking by charging certain amount? Whether open parking has to be handed to society or can be sold in open market? MahaRERA decides

https://wp.me/pcenps-133Q


State Consumer Forums

State Consumer Disputes Redressal Commission, U.T. Chandigarh

♦ Consumer spending hefty amount has right to ask for record of expenditure. Can service provider evade liability? Read on

…every person who is shredding hefty amount from his pocket towards the services being provided to him, has the right to know as to how, where and in what manner, the same has been utilized.”

https://wp.me/pcenps-12OG

Consumer Disputes Redressal Commission Gujarat State, Ahmedabad

♦ Consumer Forum | Can complainant raise consumer dispute where excess electricity duty is charged? Is he overriding statutory remedy if he already approached the Collector? Read on

“Section 3 of Consumer Proetction Act cannot be said to be inconsistent with Rule 12 of the Electricity Duty Rules.”

https://wp.me/pcenps-12Ns

State Consumer Disputes Redressal Commission, Telangana

♦ Can insurance company repudiate claim if insured suppresses fact of suffering from ailment while taking policy? Telangana State Consumer Forum answers

“If the insurer can show that prior to the date of declaration of being healthy, the insured was suffering with ailment which was within her knowledge but was suppressed, then the insurance company is well within its right to repudiate the claim on the ground of suppression veri.”

https://wp.me/pcenps-134C


Securities Appellate Tribunal

♦ Oscillating Independent Director; SAT to determine independency of Pradip K. Khaitan, independent director of Dhunseri Ventures Ltd.

https://wp.me/pcenps-12PM

♦ SAT | SEBI exonerated preferential allottees, exit providers and LTP contributors from manipulation | SAT terms it ‘cryptic’

https://wp.me/pcenps-135j

♦ SAT | Franklin Templeton gets interim relief | Gives due consideration to the 2 decades’ reputation

https://wp.me/pcenps-138Y


Securities Exchange Board of India

♦ Infosys insider trading | While in possession of Unpublished Price Sensitive Information, 2 employees of Infosys & 6 other entities violated Insider Trading Regulations on Infosys Stock [Detailed Report]

“The liability of acting partners and non-acting partners (collectively known as firm) for the injury to the third party is an outcome of joint and several liability of such partners under IPA, irrespective of whether that the conduct (act of omission or commission of the firm) which gave rise to the loss/injury to the third party is also in violation of any provision under securities law.”

https://wp.me/scenps-infosys

♦ Decoded | SEBI bars Director of Franklin Templeton AMC,  wife from accessing securities markets for 1 yr: Can redemption of units by Director of a mutual fund AMC be titled as fair conduct?

Laws dealing with information asymmetries (PIT Regulations and PFUTP Regulations) essentially seek to address the issues arising out of disparities in access to material information, that is otherwise not legally available to general investors, and to prevent those persons having access to such superior information from exploiting the informational advantage, in order to protect the integrity of the market and maintain investor confidence.

https://wp.me/pcenps-12Vh

♦ SEBI | Not so “independent” Independent director and a concocted scheme with affinity and consanguinity |SEBI takes on each violation with mordant remarks

“…remuneration and qualification are two crucial criterions to evaluate and adjudge the significance of a position held by a person in an organisation and his importance and status in participating in the management of a company.”

https://wp.me/pcenps-133k

♦ SEBI | Kingfisher’s chopped wings and shrinked wingspan | United Breweries Acquisition | Heineken exempted from the obligation under Takeover Regulations with exceptions

https://wp.me/pcenps-135X