Writ dismissed as alternative remedy u/s. 15T of SEBI Act available: Madras HC

SAS Cityscapes Pvt. Ltd Vs Securities and Exchange Board of India (Madras High Court)

Madras High Court dismissed the petition on the ground of availability of an effective and efficacious alternative remedy under section 15T of the Securities and Exchange Board of India Act, 1992 [SEBI Act].

Facts- This writ petition has been filed challenging the order passed by the 1^st respondent in SRO/Recovery/2021-2022/01 dated 28.05.2021 and for a consequential direction to release the properties purchased by the petitioner company and to permit the petitioner to register the documents submitted for registration before the concerned Sub Registrar office.

The 1^st respondent has questioned the transaction that took place between the petitioner and the 2^nd respondent and according to the 1st respondent, the petitioner is not a bonafide purchaser and that the sale deeds and the sale agreements are sham and nominal documents and such a transaction was entered into only to frustrate the SEBI from recovering the dues from the 2^nd respondent. The 1^st respondent has also taken a stand that the alienation itself is void in view of the fact that service of notice of demand was issued to the 2^nd respondent on 10.09.2018 and it was received on 12.09.2018 and 14.09.2018 respectively and thereafter, the 2^nd respondent has executed the sale deeds and the sale agreements. The order of attachment was passed on 14.05.2019 and Rule 16(1) r/w Rule 51 of the II Schedule of the Income Tax Act, 1961, makes it clear that any immovable property that is attached under the schedule shall relate back and take effect from the date of which the notice to pay the arrears was issued and served upon the defaulter. Therefore, since the attachment takes effect from 10.09.2018, the 1^st respondent has taken a stand that the transaction itself is void. The 1^st respondent has also questioned the maintainability of this writ petition on the ground that there is an alternative remedy available to the petitioner to file an appeal. In view of the same, the 1st respondent has sought for the dismissal of this writ petition.