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SAT upholds Sebi ban on Ketan Parekh firm

Securities Appellate Tribunal on Thursday upheld Securities and Exchange Board of India's ban on Ketan Parekh's Triumph International Finance Ltd from undertaking fresh business as merchant banker and broker and asked the market regulator to complete enquiry and pass final order within 10 weeks.

Setting aside the appeal by Triumph International, SAT said, "in light of facts and circumstances of the case and legal position set out by Bombay high court in Anand Rathi case it was not proper to interfere with the Sebi order."

Sebi directive (April and June 2001) of restraining TIFL was an interim order and not a final directive. The market regulator should complete the inquiry and pass the final order with detailed reasons within 10 weeks, SAT said in its order.

On April 4, Ketan Parekh's entities including TIFL, Classic Shares and Stock Broking Services Ltd, Triumph Securities Ltd and N H Securities were barred from soliciting fresh business for their alleged involvement in manipulating the capital market leading to the March 2 crash.

Asking Sebi to stick to the time frame of 10 weeks, SAT said the scope of inquiry may be wide and persons under scrutiny may be large, but it cannot go on endlessly as TIFL has been out of business, subject to inquiry, since April last and "such continued deprivation of its rights indefinitely is not a matter to be viewed lightly."

If Sebi fails to pass a final order within 10 weeks, the market regulator's interim order would cease to operate and appellant could undertake fresh business as stockbroker and merchant banker, SAT added.

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