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2013 (5) TMI 435 - SECURITIES AND EXCHANGE BOARD OF INDIAMisleading advertisements as regards issue of buy-back as well as bonus shares - Appellants contested that both the schemes of buy-back and bonus shares did not materialize at all & in the process they suffered huge losses - prayer for direction to SEBI for grant of compensation for the loss suffered by them in the course of the transaction in respect of 1,71,773 shares in question @ Rs.30 per share at least - Held that:- There is no directive or mandate in any of the 15 or 16 measures empowering SEBI to undertake the task of considering and granting compensation to an investor for the alleged losses he might have suffered due to certain misleading or fraudulent advertisements by a company. Thus the prayer of the Appellants seeking a direction to the SEBI to grant them compensation to the tune of Rs.51,53,190/- for the alleged loss suffered on account of the purchase/sale of 1,71,773 shares of VCL is totally misconceived and is hereby rejected. Appellants' prayer for compensating him for the alleged loss is in the nature of a claim for damages on account of such alleged fraudulent and misleading representations by the VCL through various advertisements needs to be looked into by a civil court of competent jurisdiction in a trial and not by SEBI under the SEBI Act, 1992 for the simple reason that SEBI has neither the expertise nor infrastructure for this purpose. There is no mandate in law requiring SEBI to do so in case any investor suffers loss on account of trading in shares etc. Direction to SEBI to launch an investigation into the alleged misleading and/or fraudulent advertisement by VCL no doubt is acceptable as SEBI is duly authorized by the SEBI Act, 1992 to do so in any given and fit case in this connection. SEBI itself has stated in its affidavit in reply dated 6th March, 2013 filed by Ms. Doel Saha, Assistant Legal Advisor that SEBI has already taken action against VCL and its directors under Section 11B and by an order dated 20th February, 2008, VCL was barred from accessing the securities market and from buying, selling or dealing in securities for a period of two years - Thus SEBI directed to look into the part of the complaint of the Appellants which relates to the alleged misleading and fraudulent advertisements issued by VCL, along with the investigation, understandably, being carried on in respect of VCL or separately, as it may be advised and considered fit and proper in the circumstances of this case as per law.
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