KAMAL ARORA Vs. DELHI STOCK EXCHANGE ASSOCIATION LTD

JUDGEMENT

(1.) The plaintiff has filed a suit for recovery of Rs.75,00,000/- along with future interest and costs. The plaintiff claims to have been dealing in the trading of shares since 1996 and came across the auction which was to be held in July, 2000 by the defendant to auction two membership cards. Defendant is the Delhi Stock Exchange Association Limited and there has to be a membership of the said Association to facilitate the trading. Apparently some members may have defaulted with the result that two member cards became available for being auctioned. A circular for auction was issued on 7.7.2000 and the auction was scheduled for 20.7.2000.

(2.) The plaintiff participated in the auction and completed the necessary formalities and the bid of the plaintiff, being the highest for Rs.53.60 lacs, was accepted. The plaintiff deposited the full amount after the acceptance of the bid and also furnished requisite information and documents in September, 2000 along with an application for admission to the membership of the defendant.

(3.) It is the case of the plaintiff that though the share transfer tickets along with share transfer forms were deposited with the defendant and the plaintiff was assured that he would be enrolled shortly, the plaintiff never received any intimation of the same. It is only in October, 2000 that certain further documents were asked for from the plaintiff which were submitted by the plaintiff in November, 2000. The application of the plaintiff had to be forwarded to SEBI for approval in order to permit the plaintiff to trade. The draft of Rs.5,000/- towards admission fee submitted by the plaintiff for the said purpose had lapsed by the relevant time and the plaintiff had to get a new draft made in January, 2001. The plaintiff was also called upon to make an application for registration as a Stock Broker in SEBI in September, 2000, which the plaintiff submitted on 25.2.2001. Even as in March, 2001, further formalities were called for.