Vicarious liability of a company director under SEBI Act cannot be quashed at threshold without unimpeachable rebuttal material.

A quashing petition against a criminal complaint and summoning order under the SEBI Act was rejected where the complaint specifically averred that the director was in charge of and responsible to the company for its business during the relevant period. The Court held that, at the quashing stage, it would not conduct a mini trial or resolve disputed facts, and the petitioner had produced no unimpeachable material to rebut the statutory averment or show abuse of process. The question of the director's vicarious liability had to be examined at trial, so the challenge to the complaint and summoning order failed.

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Issues: Whether the criminal complaint and summoning order against the petitioner, a director of the company, were liable to be quashed for absence of specific averments and for want of material to attract vicarious liability under the SEBI Act.

Analysis: The complaint contained an express averment that the petitioner was a director and was in charge of and responsible to the company for the conduct of its business during the relevant period. The Court noted that the petitioner produced no unimpeachable material to rebut that averment or to show that continuation of the proceedings would amount to abuse of process. In a quashing petition, the Court does not undertake a mini trial or resolve disputed facts, and the question whether the petitioner was liable as a director for the alleged violations had to be tested at trial.

Conclusion: The challenge to the complaint and the summoning order failed, and the petitioner was not entitled to quashing.

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