C. Mackertich Ltd. Vs. Custodian - Court Judgment

Asok Kumar Ganguly, J.

1. This writ petition has been filed by C. Mackertich Ltd., a company incorporated under the Companies Act, 1956 and one Bijoy Kumar Kothari, director and shareholder of the petitioner-company (the said company) challenging, inter alia, various communications dated 20-11-2001, dated 26-11-2001 and also dated 5-12-2001 and 10-12-2001.

2. The case of the petitioner is that a notification dated 20-11-2001, was issued by the Mr. D.K. Tyagi, the Custodian appointed under Section 3(1) of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 ('the Act').

3. From the said notification, it appears that in exercise of power under Section 3(2), the Custodian has notified certain persons and entities andissued a public notice to that effect. In the said list of persons and entities which has been disclosed in this writ petition the name of Shri Ajoy Kayan figures as the proprietor of the petitioner-company. The precise notification against Shri Ajoy Kayan ('notified person') is in the following terms :

'Notification

New Delhi, the 20th November, 2001

No. Custodian/13/2001

I, D.K. Tyagi, appointed as Custodian under Section 3(1) of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 vide Government of India, Ministry of Finance, Department of Economic Affairs (Banking Division) No. E4/3/94-SCS/VIG, dated 4-9-2001, having been satisfied on information received that the persons/entities named below had been involved in offences relating to transactions in securities after the 1st day of April, 1991 and on and before 6th June, 1992, hereby notify them in exercise of powers vested in me by Section 3(2) of the Act:

1. Shri Ajoy Kayan

(a) Proprietor, M/s. C. Mackertich and Co.

Stock Brokers, Kolkata.

(b) S/o Shri G.S. Kayan

9/2, Hungerford Street, Kolkata-17.'

4. It appears from the disclosure made in the writ petition that the copy of the said notification has been sent to various stock exchanges by the officer on special duty for their information and necessary action. The said communication was sent by the officer on special duty on behalf of the Custodian on 22-11-2001. Immediately thereafter on 26-11-2001, the Stock Exchange, Mumbai, wrote a letter to the petitioner-company stating therein the fact of issuance of the said notification about the notified person. It was also stated in the said letter that the notified person was earlier a member of the Stock Exchange, in his individual capacity and is now a designated director and majority shareholder of the said company holding 68.93 per cent of the shares. In the said letter, the Mumbai Stock Exchange made it clear that they are seeking certain clarifications from the custodian whether notifying the dominant shareholder of the petitioner-company would have any effect on it. As such the BOLT terminals of the petitioner-company were de-activated with effect from 26-11-2001, till such clarification is received from the Custodian. Then came another letter from the Stock Exchange, Mumbai requesting the said company to advise the notified person to resign as a designated director from the said company with immediate effect. The said company then wrote a letter dated 4-12-2001, to the General Manager, Membership Services of Mumbai Stock Exchange stating therein that the exchange has acted in undue haste in de-activating the BOLT terminals withouteven giving the said company an opportunity of being heard in the matter. It was also stated that the petitioner-company is a separate and distinct legal entity in the eyes of law and cannot be made to suffer because the notified person is the director of the petitioner-company, as such a request was made to re-activate the BOLT terminals at the earliest.

5. By a letter dated 5-12-2001, from National Stock Exchange of India Ltd., the National Stock Exchange also wrote to the petitioner-company referring to the order of the custodian and in the said communication, it was stated that the notified person is a whole-time director and dominant shareholder with a holding of 97.94 per cent share as on 31-3-2001, in the petitioner-company. Therefore, the National Stock Exchange has decided to withdraw the trading facility of the petitioner-company with effect from 5-12-2001, on the capital market segment of the National Stock Exchange till further notice. The petitioner-company wrote a letter to the assistant vice-president of the National Stock Exchange of India Ltd., praying for cancelling the withdrawal of the trading facilities from their terminals, inter alia, contending that as a result of notification against the notified person, the company--a non-notified person, cannot suffer. Then comes the letter of the Calcutta Stock Exchange dated 10-12-2001, to the petitioner-company seeking certain clarifications from the petitioner-company. It was made clear in the said letter that the implications of the subsequent conversion of the proprietorship concern to a corporate entity under the Companies Act, 1956 and that of the erstwhile proprietor, who has now been notified, becoming a qualifying director/shareholder were being examined by the solicitors of the Calcutta stock exchange. The authorities of the said stock exchange, it was stated in that letter, would revert back to the petitioner-company on receipt of advice of the solicitors.

6. It may also be noted that the letter of the National Stock Exchange written to the petitioner-company on 10-12-2001, records that the change in the shareholding of the notified person was effected without obtaining prior approval of the stock exchanges. It appears that after the aforesaid communication was issued on 20-11-2001, the notified person, in view of the suggestion of one of the stock exchanges, was requested by the shareholders of the said company to resign from the board of directors to avoid all controversies. Thereafter a letter dated 12-12-2001, was written by the notified person to the board of directors of the petitioner-company that in view of the above notification he has decided to resign from the board of directors with immediate effect. It further appears from the extract of the minutes of the board meeting of the petitioner-company dated 13-12-2001, that the resignation of the notified person was accepted with immediate effect. The said fact of resignation of notified person was communicated by the petitioner-company to various stock exchanges.

7. In the background of these facts, the learned counsel for the petitioner submitted that the petitioner-company has not challenged the notification but the question is whether a company has lost its right to carry on business in view of the fact that its majority shareholder has been notified. The learned counsel for the petitioner further submitted that the petitioner as a company is carrying on business as a share broker. For the purpose of carrying on the said business, the petitioner-company requires membership of a stock exchange. The petitioner-company has, therefore, become a member of the Calcutta Stock Exchange and Mumbai Stock Exchange and National Stock Exchange and the petitioner-company purchased membership cards to become a member by investing considerable money. The petitioner-company has also submitted security deposits. The learned counsel further submitted that the notification under the said Act can only be issued in respect of transactions in securities for the period after 1-4-1991, on and before 6-6-1992. But the petitioner-company has been incorporated in November, 1994. Therefore, it cannot carry on business and transactions in securities during the material period. The learned counsel further submitted that is why the petitioner-company could not be notified, referring to the provisions of Section 3(2), 3(3) and 3(4) of the said Act; the learned counsel further submitted that the object of the said Act shows that the company should be allowed to function in the normal course of business and he further urges that the suspension of the business of the company is not beneficial either to the company or to others. The learned counsel further submits that the company is distinct from its directors and the assets of the company are not the assets of the members.

8. Further referring to the provisions of Section 3(3), the learned counsel mentioned that the effect of the notification under Section 3(3) is that any property, which is belonging to any person notified, shall be attached. The membership cards of the company have not been attached nor the security deposit of the company. In fact, the learned counsel urged that those things could not be attached. It has been further urged that as a result of the notification the shares of the notified person may be attached. But the petitioner-company does not carry on business with its issued share capital. Issued shares are liabilities of the company and are so reflected in the balance sheet of every company. The shares issued by the company are not the assets of the company and the company does not carry on business with the shares issued to the members. The company is distinct from its members and shareholders. The lifting of corporate veil is always a question of fact. In the absence of any affidavit and on the basis of mere oral submission, the argument of lifting of the veil should not be entertained by this court. Therefore, the impugned orders of suspension of the business of the petitioner-company have been issued on extraneous and irrelevant consideration and are arbitrary.

9. Mr. Subba Rao, the learned counsel appearing for the Custodian, respondent No. 1 in this proceeding, argued that the instant writ petitionis not maintainable in view of the alternative remedy which is available under the said Act. Mr. Subba Rao took a stand before the court that no affidavit is necessary in this case and that the matter may be heard on the basis of the writ petition itself. After the said stand was taken by Mr. Subba Rao, all the other counsels appearing for various stock exchanges also submitted that they are not going to file any affidavit. The learned counsel appearing for different stock exchanges urged that the writ petition is not maintainable inasmuch as the stock exchanges are not authorities within the meaning of Article 12 and as such are not amenable to the writ jurisdiction of this court. The learned counsel for the stock exchanges, however, did not urge the question of availability of the alternative remedy.

10. Mr. Subba Rao in advancing his argument on the question of alternative remedy has urged that the Act in question provides a complete and efficacious remedy to the petitioner. The learned counsel submitted that in the instant case, it is because of the attachment order issued under Section 3(3) in respect of the notified person, the business of the petitioner-company has been allegedly suspended by the various stock exchanges of which the petitioner-company is a member. The learned counsel further submitted that it cannot be disputed that the properties of the notified person have been attached. Once properties are attached, the properties can only be dealt with by the Custodian in such a manner, as the Special Court may direct. The learned counsel further submits that under Section 9A(3) on and from the commencement of the Special Court (Trial of Offences Relating to Transactions in Securities) Amendment Act, 1994, no court other than the Special Court shall have or be entitled to exercise any jurisdictional power or authority in relation to any matter or claim referred to in Sub-section (1). The learned counsel further submitted that the Special Court consists of one or more sitting judges of the High Court to be nominated by the Chief Justice of the High Court within the local limits of whose jurisdiction the Special Court is situated. Such nomination shall have to be made with the concurrence of the Chief Justice of India. Against an order of the Special Court there is an appeal directly to the Supreme Court both on facts and on law. Under Section 13 of the Act, its provisions have been given overriding effect notwithstanding anything inconsistent contained in any other law for the time being in force. The learned counsel also submitted that the said Act creates special liabilities and special rights and also creates special remedies. In view of the special provisions of the said Act, the writ court should not ordinarily interfere and in a situation which is covered by the provisions of the said Act the extraordinary jurisdiction of the writ court should not be invoked. In support of the said submission Mr. Subba Rao, first relied on the judgment of the Supreme Court in the case of Titaghur Paper Mills Co. Ltd. v. State of Orissa : [1983]142ITR663(SC) , the learned counsel relied on paragraphs 6 and 11 of the said judgment.

11. The learned counsel also referred to the decision of the Supreme Court in the case of State of Maharashtra v. Prabhu : (1995)ILLJ622SC . The learned counsel also relied on the judgment in the case of Canara Bank v. Nuclear Power Corporation of India Ltd. [1995] 84 Comp. Cas. 70. The said Canara Bank judgment was delivered dealing with the provisions of the Act, The learned counsel relied on paragraphs 4, 5, 7, 10 and other paragraphs of the said Canara Bank's case judgment.

12. The learned counsel also relied on the judgment in the case of Dhyan Investments & Trading Co. Ltd. v. Central Bureau of Investigation : 2001CriLJ3952 . The learned counsel placed reliance on para 14 of the said judgment and urged that the Supreme Court has held that the Special Court is not subordinate to the High Court and High Court does not have any administrative control over the Special Court under Article 235 of the Constitution.

13. Mr. Anindya Mitra, the learned senior counsel appearing for the petitioner-company, submits in answering the argument of Mr. Subba Rao that there is no question of alternative remedy in the instant case. Mr. Mitra submits that in the instant case, the petitioner being a non-notified person, the Custodian has no jurisdiction to interfere with the business of the petitioner-company. Since the Custodian has no jurisdiction to stop the business of a non-notified person like the petitioner-company and, in fact, the Custodian has not issued any notification in respect of the petitioner-company, the Special Court cannot have any jurisdiction in respect of the grievance of the petitioner-company. It has also been stated that a Special Court is a court created under the statute. Therefore, it does not have any inherent power. The learned counsel for the petitioner-company submitted that both the petitioner-company and the stock exchanges are non-notified entities. Therefore, on the basis of the notification issued against the notified person, namely, Shri Kayan, the Custodian does not derive any jurisdiction to pass an order to stop the business of the petitioner company. In fact, no such order has been passed by the Custodian. As no such order has been passed by the Custodian, the Special Court has no jurisdiction in the matter. Since there is no jurisdiction of the Special Court over the questions which are at issue in the writ petition, there is no question of an alternative remedy being sought by the petitioner before that authority. In other words, learned counsel submitted that only against a notification issued under Section 3(2) or an order under Section 4(1), the Special Court can be moved under Section 4(2) of the Act. The learned counsel further submits that the jurisdiction of Special Court in respect of civil matters has been prescribed under Section 9A of the said Act and under Section 9A(1)(a) and 9A(1)(b) of the Act the Special Court's jurisdiction has been defined. For a proper appreciation of the controversy at issue, those Sub-sections (a) and (b) of Section 9A(1) are set out below :

'Section 9A(1)(a) relating to any property standing attached under Sub-section (3) of Section 3;

(b) arising out of transactions in securities entered into after the 1st day of April 1991, and on or before the 6th day of June 1992, in which a person notified under Sub-section (2) of Section 3 is involved as a party, broker, intermediary or in other manner.'

14. Referring to those sub-sections the learned counsel submitted that the jurisdiction of the Special Court is confined only to property attached under Sub-section (3) of Section 3 or arising out of transactions in securities entered into after 1-4-1991 and before 6-6-1992, in which a person, notified under Sub-section (2) of Section 3, is involved as a party, broker, intermediary or in any other manner. The learned counsel submitted that no jurisdiction over the petitioner can be exercised by the Special Court under Sub-sections (a) and (b) of Section 9A(1), Therefore, the learned counsel submitted that for the petitioner no remedy exists under the said Act. So there is no question of availing of the said nonexistent remedy.

15. In support of the contention that the stock exchanges are not authorities within the meaning of Article 12, the learned counsel appearing for the said respondent Nos. 3, 4 and 5 have referred to a few decisions. Reliance was placed on the decision in the case of Satish Nayak v. Cochin Stock Exchange Ltd. : AIR1995Ker373 . A Division Bench of the Kerala High Court held that a stock exchange is a company registered under the Companies Act and is not amenable to writ jurisdiction. In the said judgment it has been held by the Division Bench of the Kerala High Court that in respect of the stock exchange, the State does not lay down any policy. The management of the stock exchange is totally independent of any Government control and there is no material to show that the stock exchange is an agency of the Government. It has further been held that the memorandum of association of stock exchange does not show that it discharges any public duty. It has been said that there is no duty to be discharged by the Government in the running of stock exchanges and in the absence of such a governmental duty or function, a stock exchange merely does the business of security and it cannot be said to discharge any public duty.

16. The learned counsel also relied on the decision rendered in the case of R. Jagadeesh Kumar v. P. Srinivasan [1995] 83 Comp. Cas. 794. In that single Bench judgment the learned judge of the Karnataka High Court held that in the case of expulsion of a member by the stock exchange writ will not lie. It appears from the facts of the case that the petitioner in that case was a member of the Bangalore Stock Exchange and one Gopal Krishnan lodged a complaint that the petitioner has fraudulently prepared a contract in collusion with one Ramchandran and collected some amount directly from one C.R. Thimia and some amount from the default committee. Therefore, the matter was being heard by the Disciplinary Committee and while the Disciplinary Committee was overruling all the objections of the petitioner in the midst of that proceeding, the petitioner filed a writ petition. On those facts, the learned judge in para 7 opined thatthe first question which arises for consideration is whether a writ of mandamus would lie to the stock exchange in respect of its action to expel a member. This court in para 10 of the judgment after considering some decisions came to the conclusion that the stock exchange while exercising its power under the articles of association in the matter of admission or expulsion of a member docs a duty to that particular member and not to the public at large and does not discharge any public duty which is amenable to the writ jurisdiction.

17. The learned counsel for the respondents also relied on a Single Bench unreported judgment of Hon'ble Mr. Justice Barin Ghosh, in the case of Mahadeo Agarwal v. Union of India. His Lordship held that a writ petition against the Calcutta Stock Exchange is utterly misconceived and as such dismissed the writ petition.

18. This Court proposes to deal first with the question whether stock exchanges are amenable to writ jurisdiction.

19. In the instant case, the respondent stock exchange did not file any affidavit-in-opposition. Before this Court on 11-1-2002, the learned advocates appearing for the respondent-stock exchanges made it clear that they are not willing to use any affidavit.

20. In the absence of the affidavit, the averments made in the writ petition are to be admitted by way of non-traverse. In paragraph 12 of the said writ petition, there is an averment to the effect that the stock exchanges are bodies created under the Securities Contracts (Regulation) Act, 1956, and are public bodies discharging public functions. In paragraph 54, it has also been stated that those exchanges are statutory bodies discharging public functions and are required to act fairly and reasonably. In paragraph 56, it has also been mentioned that respondent Nos. 3, 4 and 5 have statutory duties and they are under a public duty to allow its members to carry on trading facilities. In para 57, it has also been stated that respondent Nos. 3, 4 and 5 are discharging public functions.

21. It is clear from those paragraphs of the writ petition that there is an assertion that the stock exchanges are carrying on public functions and there is no rebuttal by the respondents of those assertions.

22. In order to highlight that the stock exchanges carry on public function the attention of the court was drawn to the memorandum of association of the various stock exchanges. From the memorandum of association of the Calcutta Stock Exchange, it appears from Clause 3(bb) that one of its objects is to further the interest of the brokers, jobbers and dealers and of the public who are interested in securities. The object mentioned in Clause 3(bbb) is to maintain high standard of commercial integrity and to suppress malpractices and to regulate and control in public interest the dealing in securities. Similarly, the object behind Clause 3(cc) is to decide questions and disputes affecting the members of the association and to appoint arbitration committees. Similarly, the object behind Clause 3(kkk)is to improve and elevate the technical and business knowledge of persons engaged or about to be engaged in the trade, to provide for delivery of lecture and classes and so on.

23. To this court it appears that those activities of the said stock exchanges are conducted in public interest. Similarly, from the constitution and object of the Mumbai Stock Exchange, it is clear that the main object is to protect in public interest the character and status of the brokers and the public interest in securities and to assist, regulate and control in public interest dealing in securities to ensure fair dealing.

24. This Court finds that those objects/Memorandum of associations were adopted in the extraordinary general meeting of the stock exchanges in question and they are confirmed either by the CLB or by the Government.

25. Similarly, in the case of National Stock Exchange, it appears that the objectives arc to establish a nationwide trading facility for equities, debts, instruments, etc., and one of the objects is to meet the current international standard of the securities market. This court also finds that the stock exchanges are governed by the two Acts. The order of the said two Acts is the Securities Contracts (Regulation) Act (SCRA). The long title makes it clear that the same has been enacted to prevent undesirable transactions in securities by regulating the business dealings therein and by providing for certain other matters connected therewith or incidental thereto.

26. Under Section 3 of the SCRA, an application has to be made by the stock exchanges for recognition. Thereafter, the recognition can be granted to such stock exchanges by the Central Government only if the Central Government is satisfied after making necessary enquiries about the rules, bye-laws of the stock exchanges, which applied for registration. The recognition which will be granted by the Central Government to such stock exchanges can be upon conditions which are prescribed by the Central Government.

27. Section 5 authorises the Central Government to withdraw the recognition if the Central Government is of the opinion that such withdrawal will be in public interest and in the interest of trading. Section 6 authorises the Central Government to call for periodical returns from the recognised stock exchanges and the Central Government may direct enquiry in respect of the affairs of the said stock exchanges. Under Section 7, there is an obligation on every recognised stock exchange to furnish a copy of the annual report to the Central Government. Section 8 authorises the Central Government to direct the governing body of the stock exchange to make any rule or to amend any rule already made. Section 10 authorises the Securities and Exchange Board of India to make and amend the bye-laws of the recognised stock exchanges. Section 11 authorises the Central Government to supersede the governing body ofthe recognised stock exchange and Section 12 authorises the Central Government to suspend the business of the recognised stock exchange. The Central Government has the power to prohibit the contracts in some cases. From a perusal of the aforesaid provisions of the SCRA, this Court is of the view that there is a deep and pervasive governmental control on the activities of a stock exchange.

28. The attention of this Court has also been drawn to the provisions of the Securities and Exchange Board of India Act, 1992. The long title of the said Act also suggests that the said Act was meant for establishing a Board to protect the interest of the investors in securities and to promote the development and regulation of the securities markets and for matters connected therewith or incidental thereto. Under Section 3(1), the Central Government by a notification is to appoint a Board called the Securities and Exchange Board of India (Board). From Section 4 of the said Act, this Court finds that the composition of the said Board is overwhelmingly controlled by the Central Government. Section 11 of the said Act provides for the functions of the Board and Section 12(2)(a) shows one of the main functions of the Board is regulating the business of the stock exchange. All the other functions of the Board would show that Section 11 empowers the Board to control and regulate the business of the stock exchange through various enabling provisions. Section 29 of the SEBI enables the Central Government to make rules for carrying out the purposes of the Act. The purposes of the Act have already been referred to.

29. Similarly, under Section 30, the Board is authorised to make regulation consistent with the Act and for carrying out the purposes of the Act. Therefore, the provisions of the SEBI also point out that there are measures of control on the activities of various stock exchanges and such control is exercised by the Central Government or by the Board, which has been set up and created by the Central Government. It is also clear that such control is for the purpose of requiring the stock exchanges to function in public interest. Apart from that, it is clear that such control is required necessarily as a great deal of public interest is involved in the affairs of the stock exchange.

30. In recent times there is large-scale public participation in the business of securities, and as such, it is thought necessary that the investor's confidence in the capital market should be sustained by ensuring protection to the investor. In fact, the statement of objects and reasons for promulgating the Ordinance, prior to the SEBI would show that the SEBI was introduced for protection of the public interest and sustaining public confidence in the capital market and the business in securities. The statement of objects and reasons is set out below [1992] 73 Comp. Cas. 209 :

'Statement of Objects and Reasons

Securities and Exchange Board of India (SEBI) was established in 1988 through a Government resolution to promote orderly and healthy growthof the securities market and for investors' protection. SEBI has been monitoring the activities of stock exchanges, mutual funds, merchantbankers, etc., to achieve these goals.

The capital market has witnessed tremendous growth in recent times, characterised particularly by the increasing participation of the public. Investors' confidence in the capital market can be sustained largely by ensuring investors' protection. With this end in view, the Government decided to vest SEBI immediately with statutory powers required to deal effectively with all matters relating to capital market. As Parliament was not in session, and there was an urgent need to instil a sense of confidence in public in the growth and stability of the capital market, the President promulgated the Securities and Exchange Board of India Ordinance, 1992 (Ordinance V. of 1992), on 30th January, 1992.

The Bill seeks to replace the aforesaid Ordinance.'

31. In the context of these overwhelming materials pointing out the Governmental control over the activities of the stock exchanges, it is difficult for this court to hold that the stock exchanges do not carry out any public functions. In this connection, this court finds that while considering some of the statutory functions which have been noted above, the Kerala High Court in the case of Satish Nayaks (supra), held that the Act, viz., SCRA, is purely regulatory in character (para 25 of the judgment) and the learned judges held in para 26 of the said judgment that these regulatory measures by itself are not sufficient to establish that the stock exchange carried on any public function.

32. Reference in this connection may be made to the decision of the constitution Bench of the Hon'ble Supreme Court in the case of Madhubhai Amathalal Gandhi v. Union of India [1960] 30 Comp. Cas. 667. In the said judgment, the learned judges of the Hon'ble Supreme Court considered the provisions of the SCRA and considering the provisions of the SCRA, Justice Subba Rao (as His Lordship then was), speaking for the court held in para 3 pages 23 and 24 of the report 'in short, the Act confers an effective controlling power on the Central Government over the stock exchange'.

33. The interpretation of the SCRA by the Division Bench of the Kerala High Court in Satish Nayak's case (supra) is, thus, directly contrary to the previous Constitution Bench judgment of the Hon'ble Supreme Court. Therefore, the interpretation given by the Kerala High Court in Satish Nayak's case (supra) must be regarded as having been rendered 'per incuriam' inasmuch as it ignored the previous Constitution Bench judgment of the Apex Court on the same Act. This Court is, therefore, of the view that the judgment of the Kerala High Court is erroneous and this Court is not inclined to follow the same. This court, on the other hand, is of the view that the aforesaid provisions of the two Acts, viz., the SCRA and the SEBI, which had been discussed above empower the Government to exercise sufficient control on the stock exchanges and that they aredealing with a large number of members of the public. So public interest in the business of securities is required to be protected and this Court finds that for sustaining public confidence in such business such control is necessary. In other words, this control has been designed for the purpose of maintaining healthy financial governance of the country, in view of the opening up of the economy.

34. In the unreported judgment of the single Bench of the Calcutta High Court, in the case of Mahadeo Agarwal's (supra), the attention of the court was not drawn to various provisions of the Act, which have been discussed above. Apart from that, in that case, the facts, to the limited extent they have been disclosed, show that the petitioner wanted to surrender his card and membership after suspending his business and the petitioner wanted back the security money deposited with the stock exchange. This appears to be the limited case in the writ petition. While considering these facts, the learned judge held that getting the refund of the security deposit is neither the statutory right of the petitioner, nor is there any statutory obligation on the part of the respondent to giving such a refund. As such, the writ petition was dismissed as being utterly misconceived. In fact, there is no finding that the stock exchange is not an authority within the meaning of Article 12. This Court is of the opinion that it cannot agree with the judgment of the learned judge in the said unreported judgment of the case of Mahadeo Agarwal's (supra) and this Court is entitled to differ from the view taken by the learned single judge as the relevant aspects have not been considered in depth and the facts in that case were totally different. Now the question is one of propriety and judicial discipline. Whether I can, as a judge of a co-ordinate Bench, differ with the judgment of another learned judge of a co-ordinate Bench. I am humbly of the view that if the judge, subsequently deciding similar questions, is convinced that that the earlier judgment of a co-ordinate Bench is erroneous, the judge is at liberty to respectfully differ from the earlier view taken by another learned judge. In this view which I am taking I am fortified by a Division Bench judgment of the Acting Chief Justice Asutosh Mookerjee, in the case of Virjiban Doss Moolji v. Biseswar Lal Hargovind AIR 1921 Cal. 169. At page 171 of the report the learned judge explained the position so elegantly that I must quote it in some detail. The learned judge said '. . . No doubt, when a decision of a single judge on the original side of this court is produced before another judge, he is bound to treat it with respect, and ordinarily to follow it, if it is applicable to the circumstances of the case before him. But this does not imply that he cannot examine the matter and that it is not competent to him to take a contrary view, if he is convinced that the decision is erroneous. The answer to the question, what regard is to be had to an earlier decision of a court of co-ordinate jurisdiction, must depend upon a variety of circumstances. One important factor is the length of time during which it has stood unchallenged. Another factor, possibly of greater importance, is whether the decision gives adequate reasons for the conclusion embodied therein. But theposition is indefensible on principle, that although a judge may feel absolutely convinced that the decision produced before him is erroneous in law, he is still bound to decide against his own opinion. To take such a view is to hold that the judge may be reduced to an automation by the production of an earlier judgment...' (p. 171)

35. Those incisive observations made by the learned judge hold good still today and, in fact, have been followed by a rather recent Division Bench of this Court in the case of Pieco Electronics & Electricals Ltd. v. Smt Tribeni Devi : AIR1990Cal135 .

36. The judgment of the learned single judge of the Karnataka High Court has to be understood in the context of the facts which were decided there and that judgment cannot be treated as an authority for a proposition that a stock exchange does not ever discharge public functions. As for instance, in this case, the stock exchange has discharged functions which are public in nature inasmuch as it has tried to take action on a notification issued and sent to it by the Custodian for taking action. Therefore, the ratio of the said judgment of the Karnataka High Court in the case of R. Jagadeesh Kumar (supra) is clearly distinguishable. Apart from that various statutory provisions considered above were not placed before the learned judge of the Karnataka High Court.

37. This Court is of the view that the law relating to Article 12 of the Constitution has been substantially developed in recent times. The nature of business in stock exchanges has also undergone a sea change. From the aforesaid statutory provisions discussed, it is clear that there is substantial control on the activities of the stock exchange exercised under various provisions of the Act. The stock exchanges also in view of the altered nature of business are increasingly discharging public functions. Its activities are constantly monitored by various circulars of the SEBI. Two such circulars dated 20-4-1993 and 3-12-1997, have been handed over to the court by Mr. Mitra appearing for the writ petitioner. The first circular dated 20-4-1993, has been issued under Section 8. Under the said circular, there is a direction upon recognised stock exchanges including the Bombay and Calcutta Stock Exchanges for amendment of their respective rules of articles of associations to provide for the composition of the governing body. Therefore, it is clear that there is a direct control over the composition of the governing body of the Stock Exchange by the Central Government. The attention of this Court has also been drawn to a subsequent SEBI guidelines dated 3-12-1997 and it is clear that the same has been issued in public interest for the purpose of streamlining the management of the stock exchanges and also for the purpose of providing certain things for the benefit of the public, etc. These circulars, therefore, evidence overwhelming control of the SEBI over affairs of the stock exchange.

38. This Court on consideration of all these materials is of the view that the stock exchanges concerned are authorities within the meaning ofarticle 12 of the Constitution and they are discharging functions which have a public character. Therefore, they are amenable to the writ jurisdiction of this Court. So this Court agrees with the decisions of the Bombay High Court in the case of Mrs. Sejal Rikeeh Dalai v. Stock Exchange, Bombay [1990] 69 Comp. Cas. 709, and the Division Bench judgments of the Andhra Pradesh High Court in the case of Rakesh Gupta v. Hyderabad Stock Exchange Ltd. [1999] 96 Comp. Cas. 645, and that of the Patna High Court in Akhileshwar Upadhyaya v. Magadh Stock Exchange Association : AIR1992Pat61 . The Court does not follow the contrary, judgments of the Kerala High Court and the Karnataka High Court and the unreported judgment of a learned single judge of the Calcutta High Court referred to above.

39. The court will now deal with the argument which has been advanced by the learned counsel appearing on behalf of the respondent No. 1 about alternative remedy and non-maintainability of the writ petition in view of that remedy.

40. The law relating to alternative remedy has various facets. One of the most important aspects is that the existence of an alternative remedy does not and cannot oust the jurisdiction of a writ court. This broad proposition has never been doubted. Similarly another proposition is equally well settled that the writ court, while exercising its jurisdiction in a matter in which the statute has already provided for a remedy must consider the existence of such a remedy and this existence of an alternative remedy should operate as a factor to fetter the writ court's discretion. There are other considerations also.

41. One of them is whether the remedy which is provided is an efficacious one and is quick and effective or it is an onerous one. Another consideration is whether the remedy is provided before an impartial authority. In other words, if it is a remedy from caesar to caesar it is no longer as a remedy which inspires the confidence of the persons seeking the same. There are other well known exceptions too. Those exceptions are, namely if the impugned action is violative of the principles of natural justice or if it is vitiated by an apparent bias or mala fides of the authority taking the decision or if the decision has been taken in flagrant disregard of a fundamental statutory provision or if the situation is such that the remedy will become fruitless, viz., the authority which is to give remedy has already expressed its mind or has committed itself to an unalterable stand in the proceeding. In some cases, it has been held that once the writ petition is admitted and put up for final hearing, in such a situation, the writ court should not refuse to exercise its discretion on the ground of availability of an alternative remedy. The other exceptions are where the action taken is wholly without jurisdiction or it infringes any fundamental right of the person aggrieved or the petitioner has raised a prima facie and strong case that the action has been taken under a law which is ultra vires the Constitution. Those are generally the factors which control thediscretion of a writ court in a situation where the maintainability of the writ petition in view of the alternative remedy is very much debated. These exceptions, as pointed out above, are however, not exhaustive. This general law relating to the alternative remedy has a slightly different dimension in some cases, namely in cases relating to a taxation or election in a democratic process. In such cases normally the governing statute provides a complete code and normally the High Court does not exercise its discretion in favour of a person, who has by-passed the statutory code unless the remedy provided under the code is illusory.

42. In the instant case, the learned counsel for the petitioner has not urged that the statutory remedy is illusory or is not efficacious or that it is onerous. The objection is that the action taken by the stock exchanges of not allowing the petitioner to carry on its business is a step which has nothing to do with the notification and the notified person. So the decision of suspension of business of the petitioner-company has been issued on extraneous consideration. Such an arbitrary decision of the stock exchange can be challenged before the writ court and the court should not refuse to exercise its discretion on the ground of available alternative remedy. It has been strenuously urged that the alternative remedy is available only in the following situations : (i) where notification has been issued under Section 3(2), the person notified can only be aggrieved by such notification; (ii) where any order of cancellation of contract is passed by the custodian, the non-notified person whose contract with notified person has been cancelled may feel aggrieved; (iii) where any order has been made by the custodian, the person against whom the order has been made by the custodian may feel aggrieved. The contention is that since none of the situations is present here, this writ petition should be entertained and decided on the merits by the writ court.

43. In the background of these contentions, the Court now proposes to deal with the rival contentions advanced by counsel for the parties.

44. The judgment of the Hon'ble Apex Court in the case of Titaghur Paper Mills Co. Ltd. (supra), highlights the principles that where an Act creates certain liabilities and obligations and the Act itself provides for a machinery which gives a remedy, the remedy provided by that statute only must be availed of. [See the judgment in Titaghur Paper Mills Co. Ltd's case (supra)].

45. In laying down the said principles, the learned judges in Titaghur Paper Mills Co. Ltd. 's case (supra) have followed the dictum of justice Willes in Wolverhampton New Water Works Co. v. Hawkesford [1859] 6 CB (NS) 336 and also various other judgments of the English Court and also of the Privy Council, where the aforesaid principles have been reiterated. Therefore, the said principles, viz., that where an Act provides for a complete machinery and gives a remedy in respect of a liability fastened under the Act itself, the legislative intent of exhausting that remedy cannot be by-passed and cannot be overlooked even by the writ courtwhile exercising its discretion, on repeated reiteration have been hardened into a rule of law which operates as an autorestraint on the exercise of discretion by a writ court.

46. Reference, in this connection, can also be made to be Constitution Bench decision of the Apex Court in the case of Thansingh Nathmal v. Superintendent of Tax., Dhubri : [1964]6SCR654 . Justice Shah speaking for the court in paragraph 7 has reiterated the same principles by saying that the jurisdiction of the High Court under Article 226 of the Constitution of India even though couched in very wide terms, is essentially a discretionary jurisdiction. The learned judge made it very clear by saying that the writ court does not exercise jurisdiction merely because it is lawful to do so. Therefore, the High Court should be very careful in allowing a person to by-pass a machinery created under the statute. The decision in Thansingh Nathmal's case (supra), was also in respect of a taxing statute. In the instant case, the Special Court which has been created and set up under the Act has also been so created for dealing with violations which affect the financial governance of the country. This purpose behind the said enactment is clear from its objects and reasons.

47. The court cannot lose sight of the fact that a Joint Parliamentary Committee was constituted to investigate what has been described in the statement of objects and reasons of the said Act as 'large-scale irregularity and malpractice which were noticed in the securities transaction of banks'. The report of the Joint Parliamentary Committee, in this connection, has some relevance to highlight the objects behind the enactment of the said Act. The relevant extracts from the said report are set out:

'The scam is basically a deliberate and criminal misuse of public funds through various types of securities transactions with the aim of illegally siphoning off funds of banks and PSUs to select brokers for speculative returns. The latest irregularities in the securities and banking transactions, are manifestations of this chronic disorder since they involved not only the banks but also the stock market, financial institutions, PSU, the central bank of the country and even the Ministry of Finance, other economic ministries in varying degrees. The most unfortunate aspect has been the emergence of a culture of non-accountability which permeated all sections of the Government and banking system over the years. The state of the country's system of governance, the persistence of non-adherence to rules, regulations and guidelines, the alarming decay overtime in the banking systems has been fully exposed. These grave and numerous irregularities persisted for so long that eventually it was not the observance of regulations but their breach that came to be regarded and defended as 'market practice'. Through all these years the ability of the authorities concerned to effectively address themselves to the problems has been tested and found wanting. The consequence of these irregularities in securities and banking transactions are both financial and moral. During the period from July, 1991 to May, 1992, the most glaring proof of thenexus between the irregularities in banks and the overheating of the stock market which came to light is explained by the graphic representations of the BSE index and the fact that there was a sharp increase in securities transactions during the corresponding period of the banks involved in serious irregularities related with the scam. What is more apparent is the systematic and deliberate abuse of the system by certain unscrupulous elements. It is abundantly clear that the scam was the result of failure to check irregularities in the banking system and also liberalisation without adequate safeguards. There is also some evidence of collusion of big industrial houses playing an important role. It is because of these elements that the economy of the country had to suffer and while some gained thousands of crores, millions of investors lost their savings. The criminality of the perpetrators of the scam becomes all the more despicable as it was during this period that the country was passing through most trying times, economically and financially. An observation that the Committee has been constrained to make at a number of places in the succeeding chapters is that for all these not many have yet been identified and effectively punished.'

Therefore, the Act by way of a legislative device was brought into existence to control the enormity of the scam and its fallout and ramification. In view of this serious and urgent situation a very strong forum of adjudication under the Act, viz., the Special Court, was created by manning it with sitting High Court judge/judges, to be nominated by the Chief Justice of the High Court within whose local limits the Special Court is situated and with the concurrence of the Chief Justice of India. Therefore, the Special Court which has been created is virtually an extension of the High Court and its orders are appealable only before the Apex Court.

48. About the status of the Special Court there are various pronouncements of the Apex Court :

(a) The Supreme Court in Canara Bank's case (supra) held that a Special Court under Section 9A(1) of the Act should not be given the narrower meaning attributed to a 'civil' court which is a part of the ordinary hierarchy of courts. But, 'Special Court' should be given broader meaning of a 'curial' body, acting judicially to deal with the matters and claims arising out of the transactions in securities entered between material dates in which a person notified is involved.

(b) In Dhyan Investments & Trading Co. Ltd.'s case (supra) Justice Variava speaking for the Apex Court held that (page 13) 'the Special Court is not subordinate to the High Court and the High Court does not have any administrative control over the Special Court under Article 235 of the Constitution' (paras 40, 41, pages 613 and 614 of the report).

(c) In Pallav Sheth v. Custodian [2001] 107 Comp. Cas. 76, Justice Kripal speaking for a three-judge Bench held that in view of Section 11A that it is clear that (page 80) '...just as the High Court, being a court of record, has the power under Article 215 of the Constitution of India to punish for contempt of itself similarly, the Special Court consisting of a judge of the High Court can also exercise that power available under Article 215.' (para 9 page 557 of the report).

(d) In Harshad S. Mehta v. State of Maharashtra : 2001CriLJ4259 , Justice Y.K. Sabharwal, speaking for a three-judge Bench held that Section 9(4) confers (page 372) '.......inherent powers on theSpecial Court to deal with any matter that may be brought before if and Special Court 'may adopt its own procedure consistent with principles of natural justice'.

49. The contention of the writ petitioner considered in the background of the express legislative intent and the pronouncement of the Apex Court loses much of its substance.

50. A closer look at the provisions of the Act would show that under Sub-section (2) of Section 4, the categories of persons who can go before the Special Court are as follows :

(A) any person aggrieved by the notification under Sub-section (2) of Section 3;

(b) any person who is aggrieved by any cancellation under Sub-section (1) of Section 4;

(c) or any person aggrieved by any other order made by the Custodian in exercise of his power conferred by him under Section 3 or Section 4.

51. In the instant case, the petitioners are admittedly aggrieved by the action taken by the stock exchanges on the notification in question and the stock exchanges have admittedly taken the action against the petitioners in view of the notification which was addressed to them for their information and taking 'necessary action'. Challenging that action taken by the stock exchanges this writ petition has been filed making the Custodian a party. In such a situation it cannot possibly be said that the petitioners are not 'persons aggrieved' within the meaning of Section 4(2) of the Act.

52. It is well settled that the concept of a 'person aggrieved' is no longer a traditional common law concept specially in the field of writ jurisdiction. The meaning attributable to such an expression will obviously vary according to the context in which it is found. In this case in the context of the statutory dispensation, it is clear that the expression 'person aggrieved' should be broadly interpreted to mean a person who may reasonably consider himself aggrieved. In ex parte Sidebotham. In re Sidebotham [1880] 14 Ch. D. 458, Lord Justice James Observed as follows :

'But the words 'person aggrieved' do not really mean a man who is disappointed of a benefit which he might have received if some other order had been made. A 'person aggrieved' must be a man who has suffered a legal grievance, a man against whom a decision has been pronounced which has wrongfully deprived him of something, or wrongfully refused him something, or wrongfully affected his title to something.'

53. The aforesaid broad meaning to the expression 'person aggrieved' given by Lord Justice James has been accepted by the Supreme Court in Shobha Suresh Jumani v. Appellate Tribunal for Forfeited Property : 2001CriLJ2583 . Following the aforesaid interpretation of the expression 'person aggrieved', there can be hardly any doubt that the petitioners fall in the category of persons aggrieved by the action taken on the basis of the said notification by the stock exchanges and that is why impugning those actions this writ petition has been filed.

54. The question whether the stock exchanges acted rightly or wrongly on the basis of the said notification issued by the Custodian is a different question and the said question can be gone into and decided by the Special Court which is manned by a sitting High Court judge. This Court, however, does not express any opinion on this issue, as this court does not deal with the said question.

55. Having regard to the nature and enormity of the problem and for dealing with which the Act has been introduced and the Special Court has been set up, it will not be a sound exercise of discretion on the part of this court to decide the writ petition on the merits when a proper forum is created for this special purpose and before which the petitioner can seek a redressal of his grievances. On this aspect of the matter, this court is of the view that the principles decided in the case of Titaghur Paper Mills Co. Ltd. (supra) are very much attracted. Apart from that, on a construction of Section 9A(1)(b) and 9(3), this court finds that the Special Court has the exclusive jurisdiction to deal with any matter or claim arising out of the transaction in securities entered into during the material period in which a person notified under Sub-section (3) is involved either 'as a party, broker, intermediary or any other manner'. It is, therefore, clear that the sweep of this section is extremely wide because of two expressions, viz., 'involved' and 'any other manner'. The intention of the Legislature pursuant to the recommendation of Joint Parliamentary Committee is also to empower the Special Court as widely as possible to deal with nation-wide and large-scale irregularities and malpractices which were noticed in transactions relating to securities.

56. Now the question is whether keeping with the dominant legislative intent in view, the words 'any other manner' can be interpreted ejusdemgeneris. Possibly it cannot be so interpreted for the reasons discussed below.

It is well known that the rule ejusdem generis calls for very careful application and is not an inviolable rule of law. In a case where the context of the enactment and the object and mischief of the enactment do not require any restricted meaning, it is a duty of the court to give the words their plain and ordinary meaning (See Constitution Bench judgment of the Supreme Court in Smt. Lila Vati Bai v. State of Bombay : [1957]1SCR721 and also a later Supreme Court decision in the case of Hamdard Dawakhana v. Union of India : [1965]2SCR192 ). Lord Scarman in Quazi v. Quazi [1979] 3 All ER 897 said that if the legislative intent is not in favour of complying with this rule, an application of the rule in such a case would defeat the intention of Parliament. This rule has been described by the learned judge as 'useful servant but a bad master'.

57. Apart from that in the instant case, the words preceding the expression 'any other manner' are not mere specifications of a genus but those words constitute description of a complete genus, namely, party, broker, intermediary. In such a textual context, there is no room for application of this rule.

58. This has also been made clear by Lord Watson in Sun Fire Office v. Hart [1889] 14 AC 98 and which has been approved by our Supreme Court in Central Bank of India Ltd. v. Hartford Fire Insurance Co. Ltd. [1965] 35 Comp. Cas. 378.

59. Therefore, according to plain and literal meaning, words 'any other manner' in Section 9A(1)(b) must be very broadly interpreted.

60. So it is for the Special Court to find out on the facts whether the admitted relationship between the petitioner and the notified person can be brought within the purview of involvement between the two as a party, broker, intermediary or any other manner.

61. Mr. Anindya Mitra for the petitioner relied on the decision in the case of Tejkumar Balakrishna Ruia v. A.K. Menon [1996] 87 Comp. Cas. 539, to contend that since a notified person is even allowed to carry on business, the petitioner, a non-notified person should be allowed to carry on business by this Hon'ble Court and the writ petition should be entertained without exhausting the statutory remedy. In Tejkumar Balakrishna Ruia's case (supra) the appellant petitioned the Special Court for a declaration that the income earned by him by way of consultancy fees is not liable to attachment and a prayer was made 'to open a new bank account'. The Special Court refused the prayers. On appeal, the Hon'ble Supreme Court allowed the prayers of the appellant by holdingthat the rejection of the appellant's prayer on the interpretation of the Special Court would amount to depriving the appellant of his opportunity to earn his livelihood and to face him to beggary and even then the alms could be attached. Such an interpretation would make Section 3(3) unconstitutional. The Hon'ble Supreme Court, therefore, allowed the petitioner's income from consultancy on the basis of his appointment as adviser, which was made after the date of notification, as beyond the purview of Section 3(3).

62. But relief was obtained in that case by the appellant not by filing a writ petition. On the other hand a petition was filed before the Special Court and then an appeal was filed before the Supreme Court. Therefore, the remedy under the statute was availed of. Similarly in this case it is open to the petitioner to approach the Special Court to obtain the relief, if any.

63. Another decision cited by Mr. Mitra on this point is in the case of Kudremukh Iron Ore Co. Ltd. v. Fairgrowth Financial Services Ltd. [1994] 81 Comp. Cas. 551. In that case, Kudremukh made certain deposits with Andhra Bank Financial Services who in turn de-posited money with Fairgrowth Financial Services Ltd. which was notified and whose money was attached. When the deposits of Kudremukh fell due, Andhra Bank failed to repay, as its money was locked up with Fairgrowth. At this juncture, Kundremukh, though not notified, moved the Special Court for an order that the Custodian be directed to sell the securities of Fairgrowth and out of the sale proceeds the sum of Rs. 54 lakhs be appropriated and discharged towards the appellant's claim. The Special Court declined the prayer. On appeal the Supreme Court affirmed the same, inter alia, on the ground that there is no privity of contract between the appellant and Fairgrowth. But that cannot be said here. It is nobody's case that there is no nexus or privity between the petitioner-company and the notified person. Nor can it be said that there is no 'contractual, statutory or other legally recognised rights' between the petitioner and the notified person as was the case in Kudremukh Iron Ore Co. Ltd. 's case (supra). In any event even in the Kudremukh initially the Special Court was moved and then on appeal the Supreme Court. A writ petition was not filed. Therefore, the ratio in Kudremukh Iron Ore Co. Ltd.'s case (supra) does not assist the petitioner.

64. Mr. Mitra also relied on the decision of the Supreme Court in the case of Whirlpool Corporation v. Registrar of Trade Marks, Mumbai : AIR1999SC22 for the purpose of showing that in a case where the statutory remedy is not adequate, the writ petition should be entertained without exhaustion of the same.

65. The facts in the case of Whirlpool Corpn. (supra) are entirely different. Certain proceedings were pending before the statutory authority and the appellant's suit against Chinar Trust was pending in the Delhi High Courtin which the grant of interim order was affirmed on contest right up to the Apex Court. At this juncture a show-cause notice was issued by the registrar asking the appellant to show-cause why its certificate of registration will not be cancelled. A writ petition, challenging that notice, was filed by the appellant in the Bombay High Court and the Bombay High Court dismissed it. Challenging that decision, the appeal was filed in the Supreme Court.

66. Examining the scope of the writ court's power vis-a-vis the alternative remedy under the statute, the Apex Court summarised the legal principles in paragraphs 14, 15 and 20 of the judgment. The Apex Court found on the merits that the show-cause notice issued by the Registrar was without jurisdiction and quashed the same and held that if any order is passed without jurisdiction by a statutory Tribunal, the aggrieved person, without submitting to the proceeding initiated without jurisdiction, can challenge the same by a writ petition. There can be no doubt about the said settled principle.

67. But the said ratio has no application here. In fact no proceeding has been initiated before the Special Court. Apart from that, having regard to the special nature of the forum provided by the Special Court and the reasons for setting up such a forum, which have been discussed before, the present case is completely distinguished from the ratio laid down in Whirlpool Corpn.'s case (supra).

Therefore, the said decision in Whirlpool Corpn.'s case (supra) does not apply to the questions raised here.

68. Even though in this case affidavits have not been filed, certain facts appear from the materials disclosed in the petition itself. From the petition it cannot be disputed that the notified person was previously the proprietor of the petitioner-company and that is how the notification has been issued.

69. Thereafter, the notified person had till 31-3-2001, 97.24 per cent shareholding in the petitioner-company. Then on 15-6-2001, the notified person reduced his share capital to 68.93 per cent and this change of share capital has been introduced without the approval of the stock exchanges. After such reduction of share capital other directors of the company became one Mr. M.G. Khanna and Mrs. Lalit Kayan. After the notification was issued, the notified person on the advice of one of the stock exchanges and in view of the notification decided to resign from the board of directors. In view of these facts, which would appear from the writ petition itself, and in view of the direction from the custodian to the stock exchanges to take appropriate action, the impugned actions have been taken by the various stock exchanges.

70. Now it is difficult for this court to hold, in view of the aforesaid statutory provision and the factual aspects pointed out above that the Special Court will have no jurisdiction. The matter needs a factual probe. The Special Court has all the powers to go into all the factual aspects and which exercise the writ court does not undertake. The Special Court is vested with all the powers of a civil court under the Code of Civil Procedure, 1908, as laid down in Section 9A(5) for deciding all questions as mentioned in Section 9A(1)(6). A court endowed with these powers will be the more appropriate forum. There can be no dispute on that.

71. These are the reasons which induce this court to decline the exercise of its jurisdiction in view of the existence of a forum where all questions can be more effectively thrashed out. In fact, learned counsel appearing for the custodian submitted before this court that because of the intervention of this court and the consequential passing of an order dated 20-12-2001, with certain interim directions, the custodian has not made any application before the Special Court under the Act. Had here been no intervention by this court, the custodian might have made the application.

72. This court, therefore, makes it clear that it is open either to the petitioner or the custodian to take appropriate proceedings before the Special Court. This court observes that if the proceedings are initiated before the Special Court within a period of a fortnight from today, the Special Court may entertain the same without insisting on the period of 30 days limitation as mentioned in Section 4(2).

73. The factual basis necessary to decide the question of lifting the veil has not been laid before this court, as affidavits were not filed by the respondents. The said question is kept open.

74. In the facts of this case and for the reasons discussed above, this writ petition is not to be entertained by this court. Except the contention that the stock exchanges are amenable to writ jurisdiction, other points raised in this writ petition are, therefore, dismissed with liberty to the petitioner and also the custodian to initiate an appropriate proceeding before the Special Court under the said Act within the time-limit mentioned above. Since the writ petition is dismissed as above no order need be passed on the modification petition. The same is dismissed as having become infructuous.

75. There will be no order as to costs.