 "Tribunal quashes Sebi order against NSDL in IPO scam")
SAT had passed a similar order last month after hearing another appeal filed by the National Securities Depository Ltd (NSDL) against another Sebi order in the same case.
In its latest order, dated August 30, 2013, SAT observed that the facts in the earlier appeal filed by NSDL were similar to facts in the present case, and therefore it directed that the Sebi order in the present appeal be also "quashed and set aside".
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The two Sebi orders, passed on December 4, 2008, had asked NSDL to conduct an independent inquiry to fix individual responsibility for failure at NSDL in the wake of IPO and demat scams between 2002-2006. NSDL board was also directed to conduct an independent audit of its systems and operations to identify the remedial measures.
After hearing NSDL's appeal against these orders, SAT last month ruled that independent probes have already been carried out by depositories and remedial measures have been taken after ascertaining that there was no individual complicity.
"Therefore, at this belated stage directing the appellant (NSDL) to institute fresh inquiry to fix individual accountability...Is wholly unjustified and unreasonable. Accordingly, we quash and set aside the impugned order dated December 4, 2008.
"This order, however, will not come in the way of the respondent to seek compliance of any other remedial measures that may be suggested by the respondent with a view to strengthen the Depository system," SAT had said in its order.
The orders were originally passed by a Sebi committee in December 2008, but were later dismissed as "null and void" by the board of the market regulator.
However, an intervention by the Supreme Court in July 2011 forced Sebi to revive the matter and Sebi's board on July 28 that year took an unprecedented decision of reviving the charges declared as "non-existent" in the past.
Subsequently, Sebi implemented the orders and served them to NSDL on July 29 for compliance, which included an independent audit of systems and operations within six months.
This was the first instance of Sebi revisiting an issue previously dismissed by it, as also an unprecedented case of the regulator being open to a report, where its own role had been criticised.
The irregularities during 2002-06 by NSDL related to cases of IPO scam and trading in unlisted shares of a company DSQ Software upon irregular dematerialistion.