SEBI Special Court Must Hear Accused Before Taking Cognizance Of Complaint Under BNSS: Bombay High Court

The Bombay High Court on 15 July held that a Special Court constituted under the Securities and Exchange Board of India Act, 1992 cannot take cognizance of offences on a complaint filed by the Securities and Exchange Board of India (SEBI) without first providing the accused an opportunity of hearing under the first proviso to Section 223(1) of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), which mandates a pre-cognizance hearing in complaint cases. Justice N.J. Jamadar quashed an order of...

SARFAESI Action Against Personal Guarantors Can Continue Without No Pending IBC Case: Telangana High Court

The Telangana High Court has held that a secured creditor is not barred from proceeding against personal guarantors under the SARFAESI Act merely because insolvency proceedings are pending against the corporate debtor. It observed that where no insolvency proceedings have been initiated against the guarantors before the National Company Law Tribunal (NCLT), there is "no legal argument against a secured creditor proceeding against personal guarantors for realization of its dues" under the...

Auction Purchaser Can Seek Refund If Material Title Defects Were Not Disclosed: Andhra Pradesh High Court

The Andhra Pradesh High Court has directed Indian Bank to refund the entire auction consideration paid by an auction purchaser, along with stamp duty, registration charges, and 9% simple interest, after holding that he could not be compelled to continue with a purchase clouded by title disputes. The court also set aside the sale certificate and the registered sale deed issued in his favour. A Division Bench of Justice Battu Devanand and Justice A. Hari Haranadha Sarma observed that an auction...

NSE Chief Performs Public Duty; Delhi High Court Rejects Former CEO Chitra Ramkrishna's Challenge To PC Act

The Delhi High Court on Thursday held that the Managing Director and Chief Executive Officer of the National Stock Exchange performs a public duty in which the public at large is invested. It dismissed former NSE chief Chitra Ramkrishna's challenge to the constitutional validity of provisions of the Prevention of Corruption Act, the sanction granted for her prosecution, and the criminal proceedings arising out of the NSE co-location case. A division bench of Justice Navin Chawla and Justice...

Delhi High Court Holds NSE Is Public Authority Under RTI Act, Upholds 2010 Ruling

The Delhi High Court on Wednesday upheld a 2010 ruling declaring the National Stock Exchange (NSE) a public authority under the Right to Information Act. It held that the exchange must be regarded as having been established or, at the very least, constituted by an order of the Central Government because governmental recognition is required for a stock exchange to function and the recognition order is issued by the Securities and Exchange Board of India (SEBI) as the Central Government's...

Bombay HC Upholds MCX Circular Allowing Negative Crude Oil Settlement, Says Traders Must Bear Risks

On 24 June, the Bombay High Court upheld the validity of a Multi Commodity Exchange of India Ltd. (MCX) circular permitting negative settlement pricing in crude oil futures, holding that traders in derivative markets must bear the risk of extreme volatility, including unprecedented price crashes. Justices R.I. Chagla and Advait M. Sethna dismissed a batch of petitions filed by Dhanera Diamonds and others challenging MCX's circular dated 21 April 2020, which fixed the final settlement price of...

Kerala High Court Declines To Stay Lakshya IPO, Cites Alternate Remedy Before SAT

The Kerala High Court on Thursday declined to stay the proposed Initial Public Offering (IPO) of Learnfluence Education Limited, the company operating the Lakshya Indian Institute of Commerce coaching platform. The Court held that the former promoter challenging the issue has an alternative statutory remedy before the Securities Appellate Tribunal (SAT). Justice Harishankar V. Menon passed the order on a writ petition filed by Adheesh Damodaran, a co-founder of Lakshya CA Campus and...

Cognizance Of SCRA Offences Requires Complaint By Government, SEBI Or Stock Exchange: Gujarat High Court

The Gujarat High Court has quashed criminal proceedings against an accused in an alleged illegal securities trading case, holding that courts cannot take cognizance of offences under the Securities Contracts (Regulation) Act on the basis of a police report alone. “A plain reading of Section 26 of the Act suggests that no court can take cognizance of any offense punishable under the Act except on a complaint made by the Central Government, the State Government, the Securities and Exchange Board...

Delhi High Court Dismisses Stock Broker's Plea Against Order Summoning Him In ₹42,000 Crore DHFL Fraud Case

The Delhi High Court has dismissed a petition filed by stockbroker Jalaj Batra challenging an order dated April 27, 2024 of a Special Judge (PC Act) at Rouse Avenue Courts, New Delhi, summoning him as an accused in the Rs 42,000 crore DHFL loan fraud and alleged share price manipulation case. The order involves taking cognisance of offences under the IPC and Prevention of Corruption Act, including criminal conspiracy, cheating, forgery and corruption. A bench of Justice Manoj Jain held that...

Ex-Promoter Of Learnfluence, Which Runs Lakshya Coaching Platform, Moves Kerala High Court Against IPO

Adheesh Damodaran, erstwhile promoter of Learnfluence Education Limited and co-founder of Lakshya CA Campus, has approached the Kerala High Court challenging the proposed initial public offering (IPO) of the company, which runs the Lakshya platform offering commerce education, alleging large-scale fraud, forgery, and manipulation of company records. In his writ petition, Damodaran has questioned the decision to allow Learnfluence to proceed with the IPO despite what he describes as “pervasive...

Digital Gold Transactions Not Outside Scope Of BUDS Act Due To Lack Of SEBI/RBI Regulation: Karnataka High Court

The Karnataka High Court has refused to quash criminal proceedings against Jar Gold Retail Private Limited and its director over allegations that its digital gold platform operates as an unregulated deposit scheme.The Court observed that merely because the purchase or storage of gold is not regulated by bodies such as the Securities and Exchange Board of India (SEBI) or the Reserve Bank of India (RBI), such transactions cannot be treated as falling outside the scope of the Banning of Unregulated...

Delhi High Court Dismisses Plea Against SEBI NOC for NSE IPO, Says Remedy Lies Before SAT

The Delhi High Court has recently dismissed a plea challenging the No Objection Certificate granted by SEBI to the National Stock Exchange in relation to its proposed Initial Public Offering. Justice Jasmeet Singh observed that the petition appeared to have been filed only to stall the IPO. “I am of the view that the present petition seems to have been filed only to interdict the IPO of respondent No. 2,” the Court held. The plea was filed by retail investor K.C. Aggarwal, who stated that he...