SAT asks NSE to hold fresh hearing in Religare case

The Securities Appellate Tribunal (SAT) has asked the National Stock Exchange (NSE) to offer fresh hearing chance to Religare Capital Markets with respect to a freak trade in some securities earlier this year.

After a freak trade came to light in shares of Tata Motors and UltraTech Cement earlier this year, Religare had said these unintended transactions took place due to software glitches and requested NSE to annul the trades.

However, the exchange refused to do so in an order dated May 3, 2013.

After hearing Religare’s appeal against NSE order, the tribunal said: “Accordingly, impugned order dated May 3, 2013 is quashed and set aside by consent and the respondent is directed to pass fresh order on merits after giving an opportunity of hearing to the appellant. All contentions of both parties are kept open.”

The order was passed by the tribunal on September 30.

Religare had submitted to the tribunal that NSE had passed the order without hearing its side.

The tribunal noted that "since the impugned order has been passed in violation of the principles of natural justice, in our opinion, it is just and proper to set aside the impugned order without going into the merits of the case and direct the respondent (NSE) to pass fresh order on merits after giving an opportunity of hearing to the appellant (Religare)".

On February 1, certain erroneous sell orders had taken place in Tata Motors and UltraTech Cement shares, due to which they had briefly fallen by 10 per cent on the NSE.

After the concerned trade the brokerage firm had said that a software technical glitch caused some "unintended transactions" leading to the erroneous sell orders.

It had also said that there was neither any broker error nor any loss caused to the clients.