Petition to Dismiss Complaint Against Company & Directors Denied Due to Lack of Evidence for Court Process Abuse | HC

Case Details: Mohd. Iqbal v. SEBI - [2023] 153 taxmann.com 682 (HC-Delhi)

Judiciary and Counsel Details

• • Amit Sharma, J.
  • Ananta Prasad Mishra, Adv. for the Petitioner.
  • Sanjay Mann & Shashank Bajpai, Advs. for the Respondent.

Facts of the Case

In the instant case, a criminal complaint was filed against the company along with its directors including the petitioner. The SEBI, by way of the said complaint, alleged that the accused company was running a Collective Investment Scheme (CIS). The petitioner along with other co-accused persons had raised an amount from the general public, without getting mandatory registration from the SEBI, thereby violating provisions of section 12(1B) of the SEBI Act.

The petitioner was summoned for the offences under sections 24 and 27 of the Act and non-bailable warrants were issued qua the petitioner and other accused persons. Thereafter, the petitioner filed an instant petition before the High Court, seeking to quash the said complaint.

It was noted that no documents were produced on record to rebut the allegations made by the SEBI to demonstrate that making the petitioner stand trial would be an abuse of the process of the Court.

The High Court observed that the question as to whether the petitioner was liable as a director of the accused company for the said offences in question was a matter of trial and had to be adjudicated before the Trial Court of the competent jurisdiction.

High Court Held

The High Court held that the disputed factual issues involved in the instant case were not to be examined by the instant Court while exercising its jurisdiction under section 482 of the Code of Criminal Procedure, to prevent abuse of process of any Court. Accordingly, the instant petition was to be dismissed.

List of Cases Referred to

• • Rashima Verma v. SEBI [2009] 95 SCL 1 (Delhi) (para 3)
  • Col. B.S. Sarao v. SEBI [2009] 89 SCL 137 (Delhi) (para 7)
  • Ankur Forest and Project Development India Ltd. v. SEBI [2011] 110 taxmann.com 58/106 SCL 578 (Delhi) (para 8)
  • SRG Infotech Ltd. v. SEBI [2014] 51 taxmann.com 28/[2015] 129 SCL 52 (Delhi) (para 9)
  • S.P. Mani and Mohan Dairy v. Dr. Snehalatha Elangovan [2022] 142 taxmann.com 317/[2023] 175 SCL 242 (SC) (para 14).