New Delhi: The Supreme Court on Friday held that the consent of the market regulator Sebi is not mandatory for the compounding of offences under section 24A of the Sebi Act but taking views of the expert body is necessary.
A bench of Justices D Y Chandrachud and M R Shah said though Sebi is not conferred with any authority to veto a decision for proceeding in trial offences, it is a regulatory and prosecuting agency and the Securities Appellate Tribunal (SAT) and the courts must obtain its views since it is an expert body. The apex court said eliciting views of Sebi is necessary for the interest of the stability of the securities market and protection of investors.
'Before taking any decision to compound an offence punishable under section 24 A, SAT or the court must obtain views of Sebi for furnishing guidance to its decision. These views unless manifestly mala fide must be accorded a high degree of deference. The court must be wary of substituting its own wisdom on the gravity of the offence or the impact on the markets while discarding the expert opinion,' the bench said.
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