New Delhi, Sep 3 (IANS): The Supreme Court on Friday asked the SEBI to file its reply on NDTV promoters' Prannoy Roy and Radhika Roy's plea seeking penalty proceeding be kept in abeyance in connection with its alleged violation of securities norms by concealing information from shareholders on some loan agreements.
Senior advocate Mukul Rohatgi, appearing for the Roys, submitted before a bench headed by Chief Justice N.V. Ramana that the third member of the Securities Appellate Tribunal (SAT) is not there, therefore and the hearing on the appeals is stuck.
He added that proceedings to levy the penalty has been initiated and the appeals have to be decided without charging the penalty at this stage.
Solicitor General Tushar Mehta, appearing for the SEBI, argued that this is misleading petition and penalty proceedings are different.
"This is an MA (miscellaneous application) filed in a disposed of matter... it is a question of law," he said.
He also submitted that the capital markets regulator will not take any coercive action against the promoters in the meantime.
At this, the bench told Mehta: "You want to initiate penalty proceedings without deciding the main issue...... We will hear it in a day and decide."
Mehta said that a response to their pleas may be filed in two weeks.
The Roys have contended that SEBI order imposing the penalty be kept in abeyance till the SAT decides their appeals.
On August 27, the Supreme Court had asked the SEBI not to take any coercive steps against the Roys, till it hears their pleas on September 3 challenging penalty proceedings in connection with the alleged violation of securities norms by concealing information from shareholders on certain loan agreements.
In February, the Supreme Court directed the SAT to hear Roy's appeals against the orders of the SEBI without the pre-condition of depositing half of the fines.
The top court had said: "Appeals are to be heard on March 4. No amount shall be recovered coercively in absence of any deposit for hearing the appeals." However, it emphasised that this order shall not be treated as a precedent.
The SAT had directed the NDTV promoters to deposit 50 per cent of the disgorged amount before the SEBI. The market regulator had imposed this penalty in the view of alleged violation of various securities norms, where information was concealed from shareholders in connection with certain loan agreements. The SAT had also noted that if NDTV were to deposit the amount, the balance would not be recovered during the pendency of the appeal before the tribunal.
The tribunal in two separate orders passed on January 4, agreed to examine the appeals filed by Roys. The couple had filed appeals against the SEBI November order, which barred them from the securities market for two years and also directed them to disgorge illegal gains of Rs 16.97 crore for indulging in insider trading more than 12 years ago. The news channel has denied these charges.