2003 (10) TMI 390 - HC - Companies Law

Summary

Issues Involved:
1. Prospective or retrospective operation of the amended section 15Z of the SEBI Act.
2. Maintainability of appeals filed before and after the amendment to section 15Z.
3. Impact of the change in the composition of the Securities Appellate Tribunal.
4. Effect of the amendment on pending appeals filed under the old section 15Z.

Issue-wise Detailed Analysis:

1. Prospective or Retrospective Operation of Amended Section 15Z:
The primary issue was whether the amended section 15Z of the SEBI Act, effective from 29-10-2002, operates prospectively or retrospectively. The court examined the legislative intent and relevant provisions, concluding that the amendment is prospective. The amendment replaced the right to appeal to the High Court with a right to appeal to the Supreme Court on questions of law, thus not affecting substantive rights but altering procedural aspects.

2. Maintainability of Appeals Filed Before and After the Amendment:
The court considered the maintainability of appeals filed before and after the amendment. SEBI Appeal Nos. 1 and 9 of 2002 were filed before the amendment, while SEBI Appeal Nos. 10 of 2002 and 1 of 2003 were filed after the amendment. The court held that appeals filed after the amendment (SEBI Appeal Nos. 10 of 2002 and 1 of 2003) are not maintainable in the High Court and should be presented to the Supreme Court. However, appeals filed before the amendment (SEBI Appeal Nos. 1 and 9 of 2002) are maintainable in the High Court.

3. Impact of the Change in the Composition of the Securities Appellate Tribunal:
The amendment changed the composition of the Securities Appellate Tribunal from a single-member body to a tribunal consisting of a Presiding Officer and two other members. This change was part of the procedural modifications and did not affect the substantive right of appeal. The court noted that the change in the tribunal's composition indicated the legislative intent to streamline the appellate process and provide a more robust appellate mechanism.

4. Effect of the Amendment on Pending Appeals Filed Under the Old Section 15Z:
The court addressed whether pending appeals filed under the old section 15Z would survive the amendment. It was held that pending appeals are not affected by the amendment and continue to be maintainable in the High Court. The court emphasized that the law which changes the forum does not affect pending actions unless the legislative intent to the contrary is clearly shown. Since there was no explicit indication in the amending Act to affect pending appeals, the High Court retained jurisdiction over them.

Conclusion:
The court concluded that SEBI Appeal Nos. 10 of 2002 and 1 of 2003 are not maintainable in the High Court and should be presented to the Supreme Court. However, SEBI Appeal Nos. 1 and 9 of 2002, filed before the amendment, remain maintainable in the High Court. The judgment clarified the prospective application of the amended section 15Z, the procedural nature of the change in the appellate forum, and the survival of pending appeals under the old section 15Z.