Bombay High Court Halts FIR Against Ex-SEBI Chair on Stock Fraud Allegations

The Bombay High Court has temporarily halted proceedings against former SEBI Chairperson Madhabi Puri Buch and others regarding alleged stock market fraud stemming from a 1994 incident. The court will hear pleas to quash the contentious order, criticized as arbitrary. SEBI and BSE contest the allegations.

The Bombay High Court has intervened in a case involving former SEBI chairperson Madhabi Puri Buch and five others, instructing the Anti-Corruption Bureau (ACB) not to act on a directive to file an FIR until March 4. This pause allows the court to review petitions challenging the order from a special court related to a 1994 stock market fraud.

The accused, including Bombay Stock Exchange Managing Director Sundararaman Ramamurthy, have sought to nullify the special court's decision, questioning its legal basis. They argue the order lacked procedural fairness, as no prior notification or hearing was given.

The charges relate to alleged fraudulent activities during a company's 1994 listing on the BSE, with claims of regulatory lapses involving SEBI. Both SEBI and the BSE have labeled the allegations as baseless and intend to challenge the order legally, underscoring ongoing questions about compliance and oversight in financial markets.

(With inputs from agencies.)