SEBI cannot be compelled to Hand over Documents already in Custody of Accused: Calcutta HC Allows Revision Application of SEBI [Read Order]

In a recent case, the Calcutta High Court held that SEBI cannot be compelled to hand over documents already in the custody of the accused. The court set aside the orders passed under the Securities and Exchange Board of India Act, 1992 (SEBI Act) and allowed the revision application.

Securities and Exchange Board of India (SEBI), the applicant filed the revisional application against an order passed by the Judge, 5th Special Court, Kolkata in Special Case under Sections 11(4)/11B/12 (1B) of the Securities and Exchange Board of India Act, 1992 and Regulation 5(1) read with Regulation 68(1)/68(2)/73/74 of the SEBI (Collective Investment Schemes) Regulations, 1999 and for offences punishable under sections 24(1)/27 of the Securities and Exchange Board of India Act thereby allowing the petition under Section 91 of the Code of Criminal Procedure preferred by the accused persons and directing the petitioner to produce and handover documents mentioned in the said petition to the accused persons.

Vide the order dated 09.02.2023, the Judge, 5th Special Court, Kolkata allowed the application under Section 91 Cr.P.C. filed by the accused persons. The court held that these documents are all supposed to be in the custody of SEBI itself since it is their own documents. There is no concrete explanation of SEBI as to why these documents have not been handed over to the accused petitioners.

It is the fact that the instant case has been filed by SEBI on the basis of WTM Order and other documents. However the petitioners have every right to demand the official documents of SEBI to dispose of the discharge petition since such official documents are in the custody of SEBI and by refusing to hand over the same to the petitioners, right of the petitioners to perhaps succeed in the discharge petition cannot be taken away.

In the said order, it was directed that “Prosecution is hereby directed to produce and handover all the documents mentioned categorically in paragraph 3 of the petition under section 91 Cr.P.C to the accused petitioners by date fixed.”

The prosecution submitted that all documents relied upon by the prosecution has been supplied to the petitioners/accused persons. It appears that the documents as prayed for in paragraph 3 of the application under Section 91 Cr.P.C. was directed to be handed over to the accused/petitioners.

Full particulars of the writ petitions including WP No. 27927(W) of 2012 instituted by MPS GDL through its Directors, inter-alia, being the accused herein and the aforesaid letters with their respective reference nos, and date before the said complaint dated November 23, 2013, and also the orders and letters subsequent to the said complaint dated November 23, 2013.

A single bench of Justice Shampa Dutt (Paul) observed that it is clearly seen that the copies of documents prayed for by the accuseds/opposite parties herein have been annexed to the writ application and under Section 91 Cr. P.C. by the accuseds/ opposite parties themselves. Two of the documents at number 10 and 11 are also available in the public domain.

As such the direction passed by the Court dated 09.02.2023 was not necessary. Order dated 30.06.2023 was passed rejecting the petitioners/ complainants prayer for recall of order dated 09.02.2023 allowing the application under Section 91 Cr.P.C. filed by the accuseds/opposite parties herein.

The Orders dated 09.02.2023 and 30.06.2023 are set aside and quashed. The application under Section 91 Cr.P.C. stands rejected as the same is not necessary at this stage as discussed and is thus not maintainable. Trial Court to first consider and dispose of the application filed by the accuseds/opposite parties under Section 277 Cr.P.C. expeditiously.

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