Relief For Ex-SEBI Chief Madhabi Puri Buch, High Court Tells ACB To Halt Filing FIR Till March 4

The Bombay High Court on Monday instructed the Maharashtra Anti-Corruption Bureau (ACB) not to file an FIR against Ex- Securities and Exchange Board of India (SEBI) chief Madhabi Puri Buch till March 4. This order directed the ACB to file an FIR against Buch and five others for alleged stock market fraud and regulatory breaches. The allegations date back to 1994, involving the listing of a company on the Bombay Stock Exchange (BSE).

A day ago, SEBI reacted to Cout's earlier direction to file a complaint against her and announced to legally challenge court's order. The organisation is dedicated to maintaining regulatory compliance across all its operations. This statement follows a decision by the Bombay High Court, which provided relief to former Sebi chairperson Madhabi Puri Buch.

Legal Proceedings and Court Orders

Madhabi Puri Buch, along with BSE MD Sundararaman Ramamurthy and others, approached the High Court seeking relief. Their pleas were presented before Justice S G Dige for an urgent hearing. The judge stated that the ACB should refrain from acting on the special court's directive until further notice.

Solicitor General Tushar Mehta represented three current whole-time SEBI directors during the hearing. Senior counsel Amit Desai appeared for BSE's Managing Director Ramamurthy and its former chairman Pramod Agarwal. They argued that the special court's order was illegal and arbitrary.

The special court's decision stemmed from a complaint by media reporter Sapan Shrivastava. He sought an investigation into alleged financial fraud, regulatory violations, and corruption involving Sebi officials. The complaint claimed fraudulent company listing on the stock exchange in 1994 with regulatory authorities' involvement.

Arguments Against Allegations

The pleas highlighted that no evidence supported Shrivastava's claims against Sebi officials. They argued there was no requirement for Sebi's NOC for listing shares on BSE at that time. Additionally, they contended that vicarious liability couldn't be imposed on Sebi officials for these alleged offences.

The pleas also described Shrivastava as a habitual complainant known for filing vexatious proceedings previously. They requested quashing of the special court order and a stay on its execution as interim relief.

Special Court's Findings

Judge S E Bangar of the special ACB court noted prima facie evidence of regulatory lapses and collusion in his March 1 order. He emphasised the need for a fair probe into these allegations. The court decided to monitor this investigation closely, demanding a status report within 30 days.

The pleas criticised that petitioners weren't notified or heard before this decision was made, rendering it legally unsustainable. They stressed that no material evidence was presented by Shrivastava to substantiate his allegations against them