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Home  » Business » Goldman Sachs case: SC sets aside penalty on Sebi

Goldman Sachs case: SC sets aside penalty on Sebi

Source: PTI
February 02, 2009 19:36 IST
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In a case related to international investment banker Goldman Sachs, the Supreme Court on Monday set aside the Rs 100,000-penalty imposed by SAT on the market regulator Securities and Exchange Board of India, which asked whether the tribunal, a quasi-judicial body, has such penal powers.

A bench headed by Justice S H Kapadia, while disposing of Sebi's plea, also expunged the Securities Appellate Tribunal's observations on Sebi's adjudicating officer Amit Pradhan. Pradhan had imposed a penalty of Rs 1 crore (Rs 10 million) on Goldman Sachs Investment (Mauritius) for furnishing 'false' declarations citing violation of the Sebi(Foreign Institutional Investors) Regulations, 1995.

Earlier, it had issued notice to the international investment banker on Sebi's petition. The regulator said that there were no explicit or implicit provisions authorising SAT to impose costs on it. solicitor general GE Vahanvati and P Venugopal, appearing for Sebi, said, "We are not challenging the judgement as a whole but only two questions of law -- one is the remarks like 'overbearing, sheer arrogance, without applying mind, etc' used in the ruling against the officer and (the)

second is the imposition of penalty."

"Such remarks are generally demoralising. Besides, there are violations on Goldman's part and the company had given wrong declarations before the officer," he added. He further added that there were no explicit or implicit provisions authorising SAT to impose costs on Sebi.

Sebi had challenged the SAT verdict that set aside the regulator's impugned order imposing a penalty of Rs 1 crore on Goldman Sachs for failing to submit the information about issuing offshore derivatives instruments to an overseas corporate body in a prescribed format and with the requisite declarations. 

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