At, SEBI Securities Exchange Board of India Securities Appellate Tribunal
By, THE HONOURABLE MR. JUSTICE J.P. DEVADHAR
By, PRESIDING OFFICER & THE HONOURABLE MR. JOG SINGH
For the Appellant: Darius Khambata, Senior Advocate with Pesi Modi, Senior Advocate, Somasekhar Sundaresan, Abhishek Venkatraman, Dhaval Kothari, Advocates i/b J. Sagar Associates, Zal Andhyarujina, Advocate with Ajai Achuthan, Advocates. For the Respondents: R1, E.P. Bharucha, Senior Advocate with Rashid Boatwalla, Aditi Kamath, Advocates i/b Manilal Kher Ambalal & Co., R2, Shashank V. Choudhary, R3, Prakash K. Shah, Advocates.
J.P. Devadhar, Presiding Officer (Oral)
1. In these two appeals, the appellants have challenged the order passed by the Standing Committee of NSE on Annulment on December 04, 2014. By the said order the Committee has declined to take on record the settlement proposed by the parties and declined to release payment as per the settlement proposed by the parties.
2. Dispute in the present case, relates to annulment of trades that were executed on October 05, 2012 where in both parties to the trade were found to have violated the norms laid down by SEBI/NSE. On an application filed by M/s. Emkay Global Financial Services Limited (‘Emkay’ for short) seeking annulment of trades, NSE by its order dated April 29, 2013 rejected the said application. Challenging the said order Emkay had filed Appeal No. 64 of 2013. While setting aside the said order and allowing the appeal by way of remand on August 26, 2014, we had directed NSE to pass fresh order on annulment application after hearing the concerned parties.
3. When the matter was taken up for fresh hearing, parties submitted settlement proposal which was rejected by NSE on ground that it has no power to take such settlement proposal. Hence the parties to the settlement proposal have filed the above appeals.
4. Before us, Mr. Bharucha Learned Senior Advocate appearing on behalf of NSE on instructions fairly stated that the settlement proposal put up by the parties is not in contravention of any of the rules/regulations/bye laws of NSE. However, he submitted that in the absence of any power, NSE could not entertain the settlement.
5. In these circumstances, since the settlement is bonafide and is not violative of any provisions of SEBI/NSE, without going into the question as to whether NSE had power to take settlement on record or not, in the peculiar facts of the present case, we, in exercise of powers conferred under rule 21 of the Securities Appellate Tribunal (Procedure) Rules, 2000 direct NSE to take on record the settlement proposed by the appellants and release the withheld payment to the parties in terms of the settlement. NSE is directed to release the withheld payment as expeditiously as possible and in any event within a period of two weeks from today.
6. Both the appeals relating to annulment of trades are disposed of accordingly. This order will not come in the way of the Disciplinary Action Committee in continuing the proceeding pending bef
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ore it against the parties to the trades in question herein. 7. Order of NSE dated December 04, 2014 impugned herein is modified accordingly to the extent setout hereinabove. 8. Both appeals are disposed of in the above terms with no order as to costs.