RITU DEVI Vs. SECURITIES AND EXCHANGE

JUDGEMENT

(1.) In all these writ petitions, the orders passed by the respective investigating authority, under section 11C of the Securities and Exchange Board of India Act, 1992, directing the petitioners herein to appear before the investigating authority for Investigation, are under challenge. The respondent is the "Securities and Exchange Board of India" constituted under the "Securities and Exchange Board of India Act, 1992" (hereinafter referred to as "the SEBI Act"). According to the impugned orders in W. P. Nos. 28703 and 28704 of 2004, the petitioners were doing the business of buying, selling or dealing in shares of NEPC group of companies during the period between June 3, 1996 and October 31, 1996. By means of the impugned orders; the petitioners were required to furnish details/information relating to the transactions, which were done during the said period, for the purpose of completing the investigation under section 11C of the SEBI Act. In W. P. Nos. 29375, 29376, 29377, 29378, 29379 and 29380 of 2004, according to the respondent, the petitioners were involved in the business of buying, selling or dealing in shares of M/s. Sai Televisions Ltd., during the period between April, 2001 to June, 2002. The petitioners, by means of the impugned orders, were directed to furnish the details/information for such, transactions, held by the petitioners to enable the investigating authority to investigate into the allegations. The petitioners, in all these writ petitions, are aggrieved by the said orders. That is how, they are before this court. Since, common issues are involved, these writ petitions were heard together and they are disposed of by this common order.

(2.) Before going into the grounds raised and the arguments advanced at length on either side, let us have a bird's eye view of the SEBI Act.

(3.) In the year 1988, by means of a resolution, the Central Government established the "Securities and Exchange Board of India" to promote orderly and healthy growth of the securities market and for the protection of the investors. Subsequently, the capital market in India had witnessed tremendous growth and the participation of the public had undergone remarkable increase. In order to enhance the confidence of the investors in the capital market, the protection of the interest of the investors was to be ensured. Keeping this in mind, the Central Government decided to vest the SEBI with statutory powers required to deal effectively with all matters relating to capital market. Since, Parliament was not in session and since there was urgent need to instill confidence in the public, the President promulgated the "Securities and Exchange Board of India Ordinance, 1992", which came into being on January 30, 1992. Subsequently, it became an Act of Parliament known as "the Securities and Exchange Board of India Act, 1992", which came into force with effect from April 4, 1992.