Home Case Index All Cases Companies Law Companies Law + AT Companies Law - 2017 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (9) TMI 392 - THE SECURITIES APPELLATE TRIBUNAL, MUMBAISEBI proceedings - discretion on SEBI to pass ad interim orders - unnatural or unreasonable delay on the part of the SEBI in passing the impugned order - Held that:- It is true that Section 11, 11(b) and 11(4) do confer wide discretion on SEBI to pass ad interim orders in order to protect the investors’ interest and for a healthy and orderly growth of the capital market. It is also equally true that by way of various judicial pronouncements this Tribunal has consistently held that the power conferred under 11, 11B and 11(4), particularly after introduction of Section 11(4), SEBI do empower it to issue ad interim ex-parte orders to achieve the twin objective enshrined in the SEBI Act, i.e, the protection of investors’ interest and orderly growth of capital market. If market abuses likely to occur, SEBI shall invoke such powers subject to the satisfaction of the Board/Members of SEBI. This discretion is a vital discretion conferred upon SEBI to be used sparingly and not in a routine manner. In normal, routine cases where investigation reveals some mischief or fraud being conceived or perpetrated in the market, SEBI should resort to adjudicating proceeding by appointing an Adjudicating Officer as per Chapter IV-A of the SEBI Act. But keeping in view the gravity of the matter, SEBI was not unjustified in invoking such extra-ordinary power. Similarly, SEBI has justified the delay of few months in passing the impugned order against the Appellant. Similarly, there is no unnatural or unreasonable delay on the part of the SEBI in passing the impugned order. In this context, a perusal of the original file on which the case of Dr. Vijay Mallya was processed reveals that decision to initiate action against the Appellant was taken at the highest level in SEBI to look into the matter and take action as per law. So it cannot be argued that no investigation or inquiry was pending against the Appellant when the SEBI invoked powers under Sections 11(1), 11(4)(b) and 11B of the SEBI Act.We are inclined to dismiss the appeal with a direction to the appellant to appear before SEBI, in person or through a legally authorized representative, and make his submissions before SEBI within 21days from today. Thereafter, SEBI shall consider the same and proceed further in the matter and pass final orders expeditiously and preferably within a period of four months in accordance with law to give finality to the issue. We make it clear that after receiving Mr. Vijay Mallya’s reply, if SEBI considers it appropriate to relax any of the conditionalities prescribed in the impugned ad-interim ex-parte order it shall be free to do so as early as possible and according to law. Ordered accordingly.
|