MANOJ KUMAR SARAF THAKUR SACHCHIDANAND SINGH BIRLA INVESTMENT SERVICES VIJAY KUMAR SINGH AND KESHAR DEO DALMIA Vs. MAGADH STOCK EXCHANGE ASSOCIATION AND UNION OF INDIA

JUDGEMENT

(1.) The petitioners, members of the Magadh Stock Exchange Association, a company incorporated under the Companies Act, 1956 (hereinafter referred to as "the stock exchange"), are aggrieved by the decision declaring them as defaulters and seek its quashing. In C.W.J.C. No. 1126 of 1991 the petitioner, in addition, also seeks certain declaration and quashing of some circulars of the stock exchange.

(2.) Despite a marathon hearing many aspects of the case touching upon the functioning of the stock exchange, in general, remained unclear to us. However, it is not necessary to go into the facts which are indeed complex and diverse, since, in my opinion, the writ petitions are fit to succeed on the ground of violation of the rules of natural justice alone.

(3.) The articles of association of the stock exchange, which are deemed to be rules under Section 2(g) of the Securities Contracts (Regulations) Act, 1956, under which the stock exchange has been established, read with its bye-laws, provide for penalties, such as, defaulter, expulsion, suspension, fine, etc. Article 29 in this connection may be noticed in extenso :