Delhi High Court - Orders
Vijay Kahol vs National Stock Exchange Of India Ltd & ... on 19 April, 2023
Author: Purushaindra Kumar Kaurav
Bench: Purushaindra Kumar Kaurav
$~19
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 11087/2019
VIJAY KAHOL ..... Petitioner
Through: Mr. Raj Shekhar Rao, Sr. Advocate
with Mr. Ashish Chauhan and Ms.
Sonal Chauhan, Advocates.
Versus
NATIONAL STOCK EXCHANGE OF INDIA LTD & ORS
..... Respondents
Through: Mr. Neeraj Malhotra, Sr. Advocate
with Mr. Sujoy sub, Mr. Vedant
Kumar and Mr. Nimish Kumar,
Advocates for R-1.
CORAM:
HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV
ORDER
% 19.04.2023
1. This petition under Article 226 of the Constitution of India seeks to direct respondent Nos.1 and 2 to settle the petitioner's claim for funds and securities against respondent No.3 and to issue other appropriate writ order or directions as may deem fit and proper in the facts of the present case.
2. The learned counsel appearing on behalf of the petitioner while taking this court through the communication dated 17.10.2018 (Annexure-9) issued by respondent No.1-National Stock Exchange of India Ltd. (in short, NSE) states that respondent No.1-NSE has crystallized the entitlement of the petitioner for the admissible amount of ₹179,99,115/-, however, the Signature Not Verified Signed By:PRIYA Signing Date:24.04.2023 12:12:16 2 respondent No.1-NSE has only released a sum of ₹25 Lakh, therefore, he states that once the claim of the petitioner has been crystallized for a sum of ₹1,79,99115/-, there is no reason as to why the remaining amount should not be released in favour of the petitioner.
3. The learned senior counsel appearing on behalf of respondent No.1- NSE raises a preliminary objection with respect to the maintainability of this petition on the ground that under Section 23L of the Securities Contracts (Regulation) Act, 1956 an appeal is provided to the Securities Appellate Tribunal (SAT) and the petitioner thus have an alternative remedy to agitate for his grievance.
4. The learned senior counsel for the respondent No.1-NSE while placing reliance on the applicable bye-laws and other attendant circumstances states that the remaining claim would be released in accordance with the applicable bye-laws of respondent No.1-NSE as and when the same becomes applicable.
5. He states that it is not the only claim of the petitioner which is under examination or consideration by respondent No.1-NSE but there are various other investors whose claims are also under consideration by respondent No.1-NSE. He, therefore, states that, at this stage, the petitioner does not have any reason to maintain the instant writ petition and otherwise also if the petitioner wants to agitate any grievance, he should take recourse of Section 23L of the Act.
6. I have heard the learned counsel appearing on behalf of the parties and perused the record.
7. The communication dated 17.10.2018 would reveal that the respondent No.1-NSE with reference to the claim submitted by the Signature Not Verified Signed By:PRIYA Signing Date:24.04.2023 12:12:16 3 petitioner for non-receipt of credit balance and on account of non-receipt securities purchased, respondent No.1-NSE examined the same and has decided to release a sum of ₹25 lakh in terms of the applicable Investor Protection Fund (IPF). The communication dated 17.10.2018, however, unequivocally records that the petitioner is found to be entitled to an amount of ₹1,79,99,115/- as per scrutiny done by respondent No.1-NSE.
8. For the sake of clarity, communication dated 17.10.2018 is reproduced as under:
"Ref. No.: NSE/DCS/2018/41552/63814 17th October 2018 MR. VIJAY KAHOL G-221 FLOOR, NEAR SANATAM DHARM MANDIR NEW DELHI 110028 MOBILE NO. 9871833121/9910263399 Dear Sir, Sub: Your claim against defaulter and expelled member Amrapali Aadya Trading & Investment Pvt. Ltd.
This is with reference to your claim for non-receipt of credit balance worth Rs. 89,48,433.00 and non- receipt of securities purchased worth Rs. 90,50,682.00 amounting to Rs. 1,79,99,115.00 against Amrapali Aadya Trading & Investment Pvt Ltd.
In W.P. (C) No. 9118/2018, the Hon'ble Delhi High Court, vide order dated 29th August 2018, directed the Exchange to examine your claim in accordance with the Byelaws of the Exchange. In compliance with the aforesaid order, your claim was examined and found admissible for an amount of Rs.1,79,99,115/- subject to a maximum limit of Rs. 25,00,000/- payable out of the Investor Protection Fund (IPF).Signature Not Verified Signed By:PRIYA Signing Date:24.04.2023 12:12:16 4
However, the Defaulters' Committee, advised the Exchange to inform the Hon'ble Delhi High Court on the admissibility of your claim and seek direction for releasing the payment of Rs 25,00,000/- you out of the IPF.
In view of the above, the Exchange shall seek direction from the Hon'ble Delhi High Court for releasing the payment of Rs 25,00,000/- to you out of the IPF.
Thanking you, Yours faithfully, For National Stocking Exchange of India Ltd.
Sd/-
Authorised Signatory Defaulters' Committee Section"
9. It is thus seen that there is no reason mentioned in the said communication as to why the respondents have not released the balance amount.
10. Since the communication dated 17.10.2018 does not reflect any reason for the non-release of the balance amount, this court is of the considered opinion that the remedy under Section 23L of the Act will not be attracted in the instant case. The appeal would only be preferred by an aggrieved person once there are some reasons which can be assailed before the appellate court calling upon the appellate court to examine the correctness of those reasons. The petitioner cannot be expected to infer the reason on his own or to call upon the appellate authority and decide the appeal.
11. In the absence of any reason, the petitioner cannot approach the appellate authority in terms of Section 23L of the Act. At this stage, this Signature Not Verified Signed By:PRIYA Signing Date:24.04.2023 12:12:16 5 court finds it appropriate to direct the respondent No.1-NSE to pass a speaking order with respect to the release or non-release of the balance amount of the petitioner.
12. The petitioner is at liberty to submit a fresh representation along with a copy of this order raising all grounds before respondent No.1-NSE and respondent No.1-NSE after receipt of such a representation will decide the same and pass a speaking order within a period of 45 days from the receipt of the representation.
13. With the aforesaid liberty, the petition stands disposed of.
14. All rights and contentions of the parties are left open.
PURUSHAINDRA KUMAR KAURAV, J APRIL 19, 2023/p Click here to check corrigendum, if any Signature Not Verified Signed By:PRIYA Signing Date:24.04.2023 12:12:16