2019 (6) TMI 1388 - SC - SEBI

Supreme Court clarifies interim payment protection in option contract appeal.

IL And FS Securities Services Ltd.   Versus Securities And Exchange Board Of India & Ors.

The Supreme Court addressed the appealability of the order dated 24.06.2019, granting interim protection for payment under an option contract. The Court ... Interim protection with regard to payment under the option contract may be granted till the first hearing by the Appellate Authority - Learned Solicitor General appearing for the Securities and Exchange Board of India (SEBI) has submitted that the order dated 24.06.2019 is not appealable. HELD THAT:- Keeping in view the limited prayer made by the applicant/appellant, we dispose of the present application by directing that the applicant/appellant may file/prefer, in terms of the statement made, proceedings challenging the order dated 24.06.2019 on or before 27.06.2019 with an application for stay in accordance with law. There would be stay of payment obligation under the option contract till the first date of hearing before the relevant Forum/Court. We further clarify that in case the applicant/appellant delays or otherwise there is delay in listing of the matter, it will be open for the respondents to point this out to the appropriate Forum/Court and ask for vacation of stay. We clarify that we have not expressed any opinion on the merits and all questions are left open. It will be open to the Forum/Court to vacate, extend or modify the stay of payment order passed by us. Issues:1. Appealability of the order dated 24.06.20192. Granting interim protection with regard to payment under the option contract3. Disposal of the present application and stay of payment obligation4. Civil Appeal No(s).5104-5105/20191. Appealability of the order dated 24.06.2019:The Supreme Court addressed the issue of appealability of the order dated 24.06.2019. The counsel for the appellant expressed the intention to appeal before the Securities Appellate Tribunal, Mumbai, and requested interim protection until the first hearing. The Solicitor General representing SEBI contended that the order was not appealable. The Court directed the appellant to file proceedings challenging the order by 27.06.2019 with an application for stay. It was clarified that there would be a stay of payment obligation under the option contract until the first hearing, leaving all questions open for the relevant Forum/Court to decide.2. Granting interim protection with regard to payment under the option contract:The Court considered the limited prayer made by the appellant and disposed of the application by allowing the appellant to file proceedings challenging the order dated 24.06.2019 before 27.06.2019. The Court granted a stay of payment obligation under the option contract until the first hearing before the relevant Forum/Court. It was emphasized that the respondents could request the vacation of stay if there were delays in listing the matter, and the Court had not expressed any opinion on the merits, leaving all questions open for the Forum/Court to decide.3. Disposal of the present application and stay of payment obligation:In disposing of the present application, the Court directed the appellant to file proceedings challenging the order dated 24.06.2019 by 27.06.2019 with an application for stay. The Court granted a stay of payment obligation under the option contract until the first hearing before the relevant Forum/Court. It was made clear that the Court had not expressed any opinion on the merits, and the Forum/Court had the authority to vacate, extend, or modify the stay of payment order passed by the Court.4. Civil Appeal No(s).5104-5105/2019:The Court, based on the orders passed regarding the appealability and stay of payment obligation, found that nothing remained in Civil Appeal No(s).5104-5105/2019. Therefore, the appeals were disposed of as infructuous, reiterating that the Court had not expressed any opinion on the merits of the case.