Increased number of Sebi orders face legal scrutiny

However, Sebi also said that the number of cases disposed off by SAT and the apex court were also higher than the previous financial year.

According to Sebi, while the number of cases filed with the tribunal stood at 780 in FY22, in FY21 545 cases were filed. While 715 cases were disposed off by SAT in FY22 , 392 cases were settled in the year-ago. Around 697 cases are still pending with SAT, the report showed.

Similarly, while the number of appeals before the Supreme Court stood at 94 in FY21, 118 cases were filed in FY22. The apex court disposed off 50 cases in FY22 compared to 31 in 2020-21.

While Sebi filed 53 cases in FY22, 28 were disposed off by the apex court. The remaining 65 cases were filed by others against Sebi, and 22 were disposedoff. As of 31 March 372 cases were pending before the SC, up from 304 in FY21.

Sebi said 1,142 cases were pending before high courts as of 31 March, down from 1,201 in the previous fiscal year.

A few important judgments, were delivered by the apex court such as the cases involving Franklin Templeton and T. Takano. On 23 April, 2020, after Franklin announced the winding up of 6 debt schemes, investors challenged its decision before various courts for flouting rules under the Sebi (Mutual Fund) Regulations, 1996. The apex court upheld that the constitutional validity of the regulations and ruled that Franklin required unitholders’ consent before winding up the schemes.

The top court said Sebi had the power to investigate if the trustees acted due to extraneous and irrelevant reasons and consideration, in violation of the regulations.

In the T.Takano case, Sebi had served a show cause notice for alleged violation of prohibition of fraudulent and unfair trade practises regulations but refused to provide the probe report on the basis of which it had sent the notice.