2005 (4) TMI 290 - SC - Companies Law

Whether the appeal is maintainable before the Securities Appel late Tribunal under the Securities and Exchange Board of India Act, 1992 against the order passed by the Board under section 4(4) of the Securities Contract (Regulation) Act, 1956? Held that - Once the Tribunal had noted that the appeal had been challenged as not being maintain able it should dispose of the issue of maintainability first before passing any further order. In that view of the matter, the impugned order dated 20-1-2005 is stayed until the Tribunal disposes of the issue of maintainability. The Tribunal is re quested to dispose of the issue as early as is conveniently possible, preferably, within a period of 8 weeks from the date.

Summary

Issues:
1. Maintainability of the appeal before the Securities Appellate Tribunal under the Securities and Exchange Board of India Act, 1992 against the order passed by the Board under section 4(4) of the Securities Contract (Regulation) Act, 1956.

Analysis:
The judgment in question revolves around the issue of whether an appeal is maintainable before the Securities Appellate Tribunal under the Securities and Exchange Board of India Act, 1992, against an order passed by the Board under section 4(4) of the Securities Contract (Regulation) Act, 1956. The Tribunal had previously issued an interim order on 20-9-2004, and the appellant had raised the question of maintainability before the Tribunal on 22-11-2004. Despite this, the Tribunal proceeded to pass an order on 20-1-2005, directing the appellant to consider the respondent's application for corporatization and demutualization outside the purview of the Board's order under section 4(4) of the Securities Contract (Regulation) Act, 1956.

The Supreme Court, upon considering the appeal against the order dated 20-1-2005, found that the Tribunal should have addressed the issue of maintainability before issuing any further orders. As a result, the Court stayed the impugned order dated 20-1-2005 until the Tribunal resolves the issue of maintainability. The Tribunal was urged to expedite the disposal of this issue within a period of 8 weeks from the date of the judgment. Subsequently, the Court disposed of the appeal without any costs being awarded.

In conclusion, the judgment emphasizes the importance of addressing the issue of maintainability before proceeding with further orders and stresses the need for timely resolution of such matters by the Tribunal. The stay on the impugned order highlights the significance of procedural propriety in legal proceedings concerning appeals before specialized tribunals like the Securities Appellate Tribunal.