Persons aggrieved within meaning of section 15T of SEBI Act, 1992


Although the words “person aggrieved” have not been defined in the Act, they have a specific connotation and are well understood by Courts and Tribunals.




Bharatbhai Baldevbhai Shah & Others



Appeal No. 142 of 2008

October 6, 2009


**       **       **       **       **       **       **       **       **       **       **       **

3.      We have heard the learned counsel for the parties and arc inclined to uphold the preliminary objection raised on behalf of the Board.   At the outset, the learned counsel for the Board argued that the appellants are not persons who can be said to be aggrieved by the impugned order and, therefore, the appeal was not maintainable under section 15T of the Act. The relevant part of section 15T reads as under:-

"Appeal to the Securities Appellate Tribunal - (I) Save as provided in sub-section (2), any person aggrieved-

(a)by an order of the Board...........

(b)by an order made by an adjudicating officer under this Act,

may prefer an appeal to a Securities Appellate Tribunal having jurisdiction in the


(2) to (6)......................................... "

A reading of the aforesaid provision makes it clear that only a "person aggrieved" could file an appeal against an order passed by the Board. Although the words "person aggrieved" have not been defined in the Act, they have a specific connotation and arc well understood by courts and tribunals. In Jasbhai Motibhai Dcsai vs. Roshan Kumar and others AIR 1976 SC 578, the learned judges of the Supreme Court were examining the question of locus standi of the appellants therein and laid down tests to distinguish between persons aggrieved and strangers and busy body of meddlesome interlopers. Persons in the last category, were said to be those who interfere in things which do not concern them and act in the name, of Pro Bono Publico though they have no interest of the public or even of their own to protect.  The learned judges further observed that the distinction between persons aggrieved and strangers was real and laid down the following broad tests in this regard:-

"Whether the applicant is a person whose legal right has been infringed? Has he suffered a legal wrong or injury, in the sense, that his interest, recognised by law, has been prejudicially and directly affected by the act or omission of the authority, complained of? Is he a person who has suffered a legal grievance, a person "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? Has he a special and substantial grievance of his own beyond some grievance or inconvenience suffered by him in common with the rest of the public? Was he entitled to object and be heard by the authority before it took the impugned action? If so, was he prejudicially affected in the exercise of that, right by the act of usurpation of jurisdiction on the part of the authority? Is the statute, in context of which the scope of the words "person aggrieved"- is being considered, a social welfare measure designated to lay down ethical or professional standards of conduct for the community? Or is it a statute, dealing with private rights of particular individuals?"

When we apply the aforesaid tests to the facts of the present case, our answer to each test is in the negative.   As already observed, the appellants arc small shareholders of the company and whatever rights they may have qua the company, they arc not concerned with the action sought to be taken by the Board against the erring market players. While ordering investigations, the Board felt that some of the delinquent entities like Respondents no.2 to 5 ought to be restrained from accessing the capital market till such time the investigations are over and subsequently on the completion of the investigations it was of the view that adjudication proceedings should be initiated against them. The Board was fully justified in taking such a view keeping in view the facts as they emerged from the investigations. The appellants cannot be allowed to interfere with such regulatory matters which is the function and duty of the Board and fall within its exclusive domain. They cannot be said to be aggrieved by the impugned order by which the earlier directions restraining Respondents no.2 to 5 from accessing the securities market were withdrawn. They can only be termed as busy body of meddlesome interlopers  who arc  wanting  to  interfere  in  matters  which  do  not  concern  them.

Howsoever liberal meaning we may assign to the words "person aggrieved", the appellants cannot fall within this expression having regard to the fact that the Board while taking disciplinary proceedings against the so called delinquent entities deals with their private rights and with particular individuals/entities and strangers like the appellants have no concern with such proceedings.  The appellants could be aggrieved by the impugned order only if that order is materially adverse to them.   They are required to establish that they have been denied or deprived of something to which they arc legally entitled in order to make them persons aggrieved or they may have to show that a legal burden is imposed on them, We do not think that the appellants satisfy these tests. In Jasbhai Motibhai Desai's case (supra), their Lordships held that the proprietor of a cinema theatre holding a license for exhibiting films was not entitled to invoke the jurisdiction of the High Court to challenge a no objection certificate granted in favour of a rival in the trade.  In this view of the matter, we have no hesitation in upholding the preliminary objection raised on behalf of the Board which we hereby do.


**      **       **       **       **       **       **       **       **       **       **       **