FAIRGROWTH INVESTMENTS LTD Vs. CUSTODIAN

JUDGEMENT

(1.) The question raised in this appeal is whether the Special Court constituted under the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 (hereinafter referred to as "the Act") has power to condone the delay in filing a petition under Section 4 (2) of the Act.

(2.) The object of the Act as stated in the Statement of Objects and Reasons is to deal with the situation created by large-scale irregularities and malpractices in transactions in securities indulged in by some brokers in collusion with the employees of various banks and financial institutions. In particular, the Act seeks to ensure speedy recovery of the funds which have been diverted from banks and financial institutions to the individual accounts of brokers. The other objectives of the Act are to punish the guilty and to restore confidence in and maintain the basic integrity and credibility of the banks and financial institutions.

(3.) With these objectives in view the Act provides for the appointment of one or more Custodians to take action against any person involved in any offence relating to transactions in securities for the period after 1-4-1991 up to and including 6-6-1992. In terms of sub-section (3) of Section 3 of the Act, the Custodian may notify the name of such person in the Official Gazette. From the date of such notification, any property movable or immovable or both, belonging to any person so notified stands attached under sub-section (3) of Section 3. Such attached properties may be dealt with by the Custodian in such manner as the Special Court may direct.