New Delhi: The Securities Appellate Tribunal (SAT) has admitted former NSE chief Chitra Ramkrishna’s plea against a Sebi order in relation to governance lapses at the bourse and directed her to deposit an amount of Rs 2 crore. The appellate tribunal also directed NSE to deposit more than Rs 4 crore towards leave encashment and deferred bonus of Chitra Ramkrishna in an escrow account as against Sebi’s direction where the amount was to be parked in the Investor Protection Fund Trust.
In an order, dated February 11, that had wider ramifications, Sebi slapped a penalty of Rs 3 crore on Ramkrishna for alleged governance lapses in a case related to the appointment of Anand Subramanian as the Group Operating Officer and Advisor when she was at the helm of NSE as its MD & CEO.
Besides, the watchdog had asked NSE to forfeit the excess leave encashment of Rs 1.54 crore and the deferred bonus of Rs 2.83 crore of Ramkrishna, and the amount was to be deposited in the Investor Protection Fund Trust.
Passing a four-page order, dated April 11, after accepting an appeal filed by Ramkrishna, SAT said that various questions raised would be considered at the time of hearing of the appeal. It also directed Sebi to submit its reply within four weeks. The appellate tribunal has listed the case for hearing June 30.
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“However, considering the fact and circumstances that has been brought on record and to balance the equities as well as balance of convenience, we direct NSE… to deposit Rs 4.73 crore towards leave encashment and deferred bonus of the appellant in an escrow account of instead of depositing it in the Investor Protection Fund Trust,” SAT said.
Further, SAT directed Ramkrishna to deposit a sum of Rs 2 crore within six weeks from today (April 11). “If such an amount is deposited, the balance amount shall not be recovered during the pendancy of the appeal,” it noted and dismissed the stay application.
Ramkrishna’s counsel CS Vaidyanathan contested Sebi’s decision to levy fine under Section 23A of the Securities Contract Regulation Act (SCRA). He argued that this provision, being prospective, could not apply to any violation which was committed prior to the amending Act and therefore the penalty under this head was ‘incorrect and could not be sustained’.