Stock market fraud case: Bombay HC grants relief to ex-Sebi chief Buch, halts ACB action until March 4

NEW DELHI: The Bombay high court on Monday granted relief to former Sebi chairperson Madhabi Puri Buch, directing the state Anti-Corruption Bureau (ACB) not to act on a special court’s order to file an FIR against her and five other officials until March 4.
The directive comes after Buch, along with Bombay Stock Exchange (BSE) Managing Director Sundararaman Ramamurthy and others, moved the court to quash the order issued on March 1.
A single bench of Justice S G Dige took up the matter for urgent hearing, saying that the pleas would be considered on Tuesday. Until then, the ACB has been instructed not to act on the order. Solicitor General Tushar Mehta represented Buch and three SEBI directors, while senior counsel Amit Desai appeared for Ramamurthy and former BSE chairman Pramod Agarwal.
Also read: Mumbai special court orders FIR against former Sebi chief and officials over listing irregularities and 'regulatory oversight'
The petitioners argued that the special court’s order was arbitrary and illegal, as they were neither notified nor given a chance to be heard before the decision was made. The special ACB court judge, S E Bangar, had ruled that there was prima facie evidence of regulatory lapses and collusion, warranting an investigation. The court also stated it would monitor the probe and sought a status report within 30 days.
The case stems from a complaint by media reporter Sapan Shrivastava, who alleged large-scale financial fraud and regulatory violations during the 1994 listing of a company on the BSE. He claimed that SEBI officials facilitated market manipulation by allowing the listing without compliance under the SEBI Act, 1992.
SEBI responded to the developments, saying that it would challenge the order through legal means. The market regulator highlighted that the allegations pertain to events that occurred long before the accused held their current positions. The BSE also dismissed the complaint as "frivolous and vexatious."
Buch, India’s first woman SEBI chief, recently completed her three-year tenure amid controversy, including allegations of conflict of interest linked to Hindenburg Research’s claims about her investment history. She has denied the accusations, saying that her investments predated her SEBI appointment.