2021 (8) TMI 1313 - HC - SEBI

Petitioner seeking direction against respondent to produce all documents relied upon by them while issuing SCN including investigation report - Code of Conduct for regulation monitoring prevention of insider trading approved and followed by the Company - HELD THAT - On the basis of the reply filed by the respondent when this Court declined to entertain the petition, the petitioner submitted that the petitioner may be permitted to withdraw the petition with liberty to put all these issues before the authority i.e. the person who is going to hear the show cause notice. Hence, the following order is passed. Writ petition stands dismissed as withdrawn. All contentions of both parties are kept open. No order as to costs.

Summary

Issues:
Petition seeking direction to produce documents relied upon by respondent while issuing show cause notice (SCN).

Analysis:
The petitioner filed a petition under Article 226 of the Constitution of India, seeking a direction against the respondent to produce all documents relied upon by them while issuing the show cause notice (SCN). The respondent, SEBI, in their affidavit-in-reply dated 15.07.2021, stated that they had already provided the requested documents. They clarified that they were not seeking to rely upon the investigation report. The respondent argued that it was not necessary to provide a copy of the investigation report itself for several reasons. They contended that the SEBI proceedings are quasi-judicial in nature and governed by the principles of natural justice. The investigation report is considered a culmination of documents relied upon during the investigation and not strict evidence. It is meant for the authority to decide whether enforcement proceedings are warranted based on prima facie grounds. The investigation report serves as interdepartmental communication between investigating officers and the deciding authority. Consequently, the respondent argued that providing only the relied-upon documentary evidence was sufficient, and there was no obligation to provide the investigation report to the Noticee.

The petitioner, upon the Court declining to entertain the petition, requested to withdraw the petition with liberty to raise the issues before the authority responsible for hearing the show cause notice. The Court, considering the submission, passed an order dismissing the writ petition as withdrawn. It kept all contentions of both parties open and made no order as to costs. This decision allowed the petitioner to address the issues raised in the petition before the appropriate authority responsible for adjudicating the show cause notice.

In conclusion, the judgment highlighted the importance of providing relied-upon documents in quasi-judicial proceedings, emphasizing the principles of natural justice. The Court's decision to dismiss the petition as withdrawn granted the petitioner the opportunity to address their concerns before the relevant authority, ensuring a fair and transparent process in the adjudication of the show cause notice.