The
A background to the case
A complaint was filed in 2002 with SEBI alleging that
In 2020, SEBI filed a criminal complaint in the
Question of Law & Findings
One of the substantial questions of law raised before the Apex Court was whether SEBI is required to disclose documents in the present set of proceedings or not?
On the above question of law, the Hon'ble Court observed that keeping a party abreast of the information that influenced the decision promotes transparency of the judicial process. In this light, SC noted the following:
"The impugned action of the appellant hails back to the year 1994, and almost three decades have gone by without there being any light at the end of the tunnel. The investigation report by SEBI in 2005 was inconclusive about the alleged offence. There is even a communique by the Minister of Corporate Affairs,
The Court further held that in the case at hand, SEBI could not have claimed privilege over certain parts of the documents and at the same time, agreeing to disclose some part. Such selective disclosure cannot be countenanced in law as it clearly amounts to cherry-picking.
Analyses & Conclusion
The said judgment passed by the Hon'ble Apex Court goes a long way to reemphasize the law that when it comes to fulfilment of the principles of natural justice and fair trail, the Regulator has no option but to provide all the documents that were relied by it for initiating the investigation and/or initiating of prosecution against other party. The Apex Court's decision will also set a precedent for parties arguing before various forums that selective furnishing of documents and/or submission of incomplete documents is also violative of principles of natural justice and the same will result in holding the proceedings to be non-est. The said decision also has reiterated the findings laid down by the Apex Court in another recent decision in case of
The judgment also lays down law on an important proposition - that selective disclosure of a document is also not permissible under the law. The said judgement can be relied upon by parties in a case where the redacted form of documents, more particularly, in the nature of Investigation Reports are provided to parties where, while the findings against said parties are retained, the balance contents of the Investigation Report are redacted out. It would be interesting to see how this plays out in the future - if Regulators will adhere to the law reemphasized by the Apex Court in the instant case to ensure that the valuable time of the court is not wasted on hearing propositions which are absolute.
Footnotes
1. Criminal Appeal No. 1167 of 2022 [@ Special Leave Petition (CRL) No. 3417/2022].
2. 2022 SCC Online SC 210. (Our earlier analyses on this case can be found by clicking here).
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