Investor payment mechanism regulated with SEBI approval, while delayed pleadings were taken on record and interim relief was limited.

Delayed reply and rejoinder were taken on record after condonation of delay. The payment mechanism for investors was allowed only in a regulated form: the appellants had to first furnish the list of investors with bank account details to SEBI, payments were to be made only after approval by SEBI's recovery officers and through proper banking channels, and the appellants' bank was to permit operation of the account solely for this limited purpose. The interim request was therefore accepted with safeguards, the miscellaneous applications were disposed of, and the matter was adjourned for further hearing.

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Issues: Whether the delayed reply and rejoinder could be taken on record and whether the appellants could be permitted to make payments to investors from the bank account for the limited purpose of disbursement to approved investors.

Analysis: The delay in filing the reply and the rejoinder was condoned and both pleadings were taken on record. In view of the need to facilitate payment to investors, the mode of payment was regulated by requiring the appellants to first furnish the list of investors with bank account details to SEBI. Payment was directed to be made only after approval by SEBI's recovery officers and through proper banking channels. SEBI was also directed to instruct the appellants' bank to permit operation of the account only for the limited purpose of making such approved payments.

Outcome: The interim request was accepted in regulated form, the miscellaneous applications were disposed of, and the matter was adjourned for further hearing.

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