BOMBAY STOCK EXCHANGE Vs. JAYA I SHAH

JUDGEMENT

(1.) INTERPRETATION of Securities Contract (Regulation) Act, 1956 (hereinafter referred to as 'the Act') vis-a-vis rules, bye- laws and the regulations framed thereunder as regard the right of a third party to realise his dues out of the corpus of the Defaulters' Committee is the question involved in this appeal which arises out of a judgment and order dated 25th July, 1997 passed by the High Court of Judicature at Bombay in Appeal No. 17 of 1996.

(2.) THE Background Fact : THE appellant herein is Bombay Stock Exchange (Exchange). It is recognized by the Central Government under the Rules, Bye-laws and Regulations framed in the year 1957 pursuant to or in furtherance of the provisions of 'the Act'. THE said rules, bye-laws and regulations are approved by the Central Government. Rights and obligations of the members of the Exchange as also the constituents/investors dealing with or through the members are governed by the Rules, Bye-laws and Regulations framed under the Act.

(3.) SEVERAL affidavits were filed by the Exchange disclosing the amount lying in its hands. In the first affidavit filed on 12-1-1995, it was disclosed that sufficient fund is available to meet the claim of the respondent. In an additional affidavit filed on 8-12-1995 it was alleged that the total amount lying with the Exchange for distribution amongst the constituent creditors of C.S. Shah was Rs. 53,56,159/-. It was further contended that in addition to that amount each creditor constituent was entitled to receive a maximum sum of Rs. 25,000/- from the Petitioner's Customer Protection Fund towards his/her claim and the said available sum of Rs. 53,56,159/- was required to be distributed on a prorata basis in terms whereof the respondent would be entitled to receive a sum of Rs. 1,16,530/- making an aggregate sum of Rs. 1,141,530/-.