• Former SEBI Chairperson Madhabi Puri Buch and five others have moved the Bombay High Court to challenge a special court’s order directing an FIR against them over alleged stock market fraud.
  • The court has scheduled a hearing for March 4, 2025, and has ordered the Anti-Corruption Bureau (ACB) to hold off on any action until then.

Former Securities and Exchange Board of India (SEBI) Chairperson Madhabi Puri Buch and five others have approached the Bombay High Court seeking to quash a special court's directive to register a First Information Report (FIR) against them over alleged stock market fraud.

The court has scheduled a hearing on their plea for March 4, 2025, and has directed the Anti-Corruption Bureau (ACB) to refrain from taking any action on the special court’s order until then.

The special ACB court, presided over by Judge Shashikant Eknathrao, had directed the registration of an FIR against Buch and other officials, citing allegations of stock market fraud and regulatory lapses. The court also stated that it would oversee the investigation and requested a status report within 30 days.

The officials named in the case include Bombay Stock Exchange (BSE) Managing Director and Chief Executive Officer Sundararaman Ramamurthy, former BSE Chairman Pramod Agarwal, and three SEBI whole-time members: Ashwani Bhatia, Ananth Narayan G, and Kamlesh Chandra Varshney.

The complaint was filed by journalist Sapan Shrivastava, who alleged that the accused were involved in the fraudulent listing of Cals Refineries Ltd on the BSE in 1994. The complaint claimed that regulatory authorities, particularly SEBI, facilitated the listing without ensuring compliance with the SEBI Act, 1992, and its related rules.

Additionally, it alleged misconduct such as round-tripping, insider trading, and price manipulation, misleading investors into believing the company was financially stable.

SEBI, in its response to the court's directive, stated that it “would be initiating appropriate legal steps to challenge this order and remains committed to ensuring due regulatory compliance in all matters.”

Meanwhile, the BSE dismissed the allegations, asserting that the application was “frivolous and vexatious in nature.” The stock exchange also pointed out that the officials named in the case were not in their respective positions at the time of the company’s listing and had no connection with it.

"The application is frivolous and vexatious in nature," the BSE stated, adding that it "is initiating necessary and appropriate legal steps in this regard." The exchange reiterated its commitment to upholding regulatory compliance and ensuring transparency.

Buch, who was India’s first woman to head SEBI, completed her three-year tenure as chairperson on Friday.

Edited by Harshajit Sarmah