SAMANT Vs. BOMBAY STOCK EXCHANGE

JUDGEMENT

(1.) In this appeal, the appellants have questioned the validity and correctness of the Order dated 14-1-1991 passed by the High Court of Bombay in Writ Petition No. 3201 of 1990, dismissing the same.

(2.) The first appellant is a partnership firm carrying on business as share and stock brokers and the second appellant is a partner of the said firm. They filed the writ petition in the High Court challenging the action of the respondent No. 1 declaring the appellants as defaulters by its resolution / notice dated 25-3-1987 and to re-admit them as member. Before the High Court mainly two grounds were urged - (i) that the decision of the respondent No. 1 declaring the appellants as defaulters was in violation of the rules of natural justice as a copy of the impugned Resolution/Notice dated 25-3-1987 was not furnished nor they were given hearing before taking decision; (2) having regard to the unblemished track record of the appellants, the decision to declare them as defaulters was illegal and unjustified besides being contrary to the conditions set out in bye-law 316. An incidental grievance of the appellants was that their application for re-admission as member was rejected contrary to the provisions contained in Rules 60 to 63. The respondent No. 1 filed a detailed counter-affidavit resisting the claims of the appellants. The High Court after considering the respective contentions of the parties and referring to the rules and bye-laws of the Stock Exchange dismissed the writ petition on the ground of delay and laches by the impugned judgment and order.

(3.) The learned Senior Counsel for the appellants contended that the order declaring the appellants as defaulters is unsustainable as it was passed in violation of rules of natural justice inasmuch as no opportunity was given to explain the show cause; no reasons are recorded in the order and that the report of the Enquiry Committee was not given. According to him, the decision of respondent No. 1 declaring the appellants as defaulters was arbitrary and that there was malice on the part of the Executive Director of respondent No. 1. It was further urged that in a case like this where the impugned action of the respondent No. 1 was void, the High Court was not justified in dismissing the writ petition on the ground of delay and laches.