SAT withdraws personal observation on Sebi's whole-time member

The Securities Appellate Tribunal (SAT) has withdrawn its earlier 'personal observation' against a whole-time member of the Securities and Exchange Board of India (Sebi) in the Adventz Finance case.

Sebi had sought modification made in the order where tribunal had rapped a whole-time member (WTM), and said that it was "distressed" with the manner the case was handled and imposed a fine of Rs 1 lakh on the Sebi.

"On the basis of aforesaid facts, counsel for Sebi submits that in the present case, since the WTM of Sebi has merely followed the practice prevalent in Sebi in the past, personal observations made against the WTM be recalled or modified, especially when Sebi by a policy has discontinued the past practice and in fact, in the present case, the WTM of Sebi has already passed an order on July 30, 2016 in accordance with law," SAT said in the order.

The matter came into light when Sebi had rejected to provide any interim relief to Jai Annanya Investments to repay a loan worth Rs 40 crore to Adventz Finance which they had later challenged in SAT.

SAT had questioned Sebi over delay in passing the final order in the case and directed it to do within a week. The tribunal had imposed penalty and made strong worded remarks against the Sebi member and directed to assign the case to some other member.

Followed by the order, Sebi had filed a review petition before the tribunal. After hearing the Sebi's counsel, the tribunal had recalled its previous order. While recalling the order SAT said, "In view of the assurance given to the effect that appropriate orders would be passed in accordance with law, we modify our order dated July 15, and permit the WTM of Sebi who had heard the appellant on June 21 to pass an appropriate order in accordance with law within one week from today after giving an opportunity of hearing to the appellant," SAT said in the order.

The matter relates to a Sebi interim order passed on August 20, 2015. Sebi had prohibited 59 entities, including Jai Annanya from securities markets and referred the case to other investigative agencies.