IN THE SECURITIES APPELLATE TRIBUNAL

MUMBAI

 

 

Appeal No: 73 of 2006

Date of Decision

12/06/2006

 

 

 

Chinta Mani Pandey	�..Appellant
Versus
1. Securities & Exchange Board of India
2. Magadh Stock Exchange Association		�.Respondents

 

 

Mr.� Manik Vedsen, Advocate for the appellant

 

Mr. Rafique Dada, Sr. Advocate with Mr. Kumar Desai, Advocate for respondent no. 1.

 

None for respondent no.2.

 

 

CORAM

 

��������� Justice N.K. Sodhi, Presiding Officer

��������� R.N. Bhardwaj, Member

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Per:��� Justice N.K. Sodhi, Presiding Officer (Oral)

 

 

This appeal filed under Section 15T of the Securities and Exchange Board of India Act, 1992 (for short �the Act�) is directed against the order dated December 6, 2005 passed by the wholetime member of the Securities and Exchange Board of India (for short �the Board�) whereby directions have been issued under Section 12A of the Securities Contracts (Regulation) Act, 1956 read with Section 11(4), 11B and 15HB of the Act directing, amongst others, the Magadh Stock Exchange (for short �the exchange�) to place the appellant under suspension and to hold disciplinary proceedings against him for the irregularities allegedly committed by him by allowing the promoters of M/s. Bhoruka Financial Services Limited to sell the shares held by them to M/s. DLF Commercial Developers Limited on the platform of the exchange in contravention of the conditions of recognition granted by the Board. The appeals filed by M/s. Bhoruka Financial Services Limited, its promoters and M/s. DLF Commercial Developers Limited against the impugned order have already been allowed by us by our order dated 10/05/2006 on the ground that while the investigations ordered by the Board were yet to commence, it had recorded firm findings against the appellants therein. Same is the case with the appellant herein. However, the case of the appellant is slightly different from the case of the appellants in the earlier appeals inasmuch as it has been alleged and prima facie found by the Board that the appellant as the officiating executive director of the exchange had allowed trading in the shares of Bhoruka Financial Services Limited in contravention of the conditions of recognition laid down by the Board. The Board has also prima facie found that the appellant had taken the decision on his own without making a reference to the board of management of the exchange.

Having heard the learned counsel for the parties we dispose of the appeal with a direction to the Board to consider the findings recorded in the impugned order as only prima facie and that it should continue with its investigations and thereafter pass a final order in accordance with law on the basis of the material that it collects during the course of the investigations without being influenced by any of the findings already recorded in the impugned order. The exchange which is respondent no.2 is restrained from continuing with the disciplinary proceedings against the appellant till such time the Board passes a final order after the conclusion of the investigations as ordered by it on December 5, 2005.� No order as to costs.

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� Justice N.K. Sodhi Presiding Officer
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R.N.Bhardwaj �������������������������������������������������������������������������������������������������������� Member

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