NSE Co-Location Case: Supreme Court Declines Stay To SEBI
The apex court has asked SEBI to return a third of the amount deposited by the NSE as part of the disgorgement order.
The Supreme Court of India on Monday declined to stay an order passed by the Securities Appellate Tribunal, which had set aside SEBI's order in the NSE co-location case.
The top court has also directed the Securities and Exchange Board of India to return Rs 300 crore to the National Stock Exchange.
In compliance with SEBI's 2019 order, the NSE had deposited Rs 1,044 crore with the regulator. After this, the appellate tribunal held that the exchange needs to deposit only Rs 100 crore.
Now, the Supreme Court has directed SEBI to return Rs 300 crore to the NSE from the Rs 944 crore it has lying with the regulator.
The apex court will hear the matter next in September.
In January of this year, the Securities Appellate Tribunal set aside SEBI’s order in the NSE co-location case for disgorging Rs 625 crore along with interest.
However, the tribunal had directed the NSE to pay Rs 100 crore towards SEBI's Investor Protection and Education Fund for its failure on the due diligence front.
The NSE, as a first-level regulator, has the frontline responsibility for regulation of markets and has a mandate to ensure compliance by the trading members to its own norms and circulars, the appellate tribunal had said.
SEBI had pronounced the order in 2019 against the stock exchange for having violated Stock Exchange and Clearing Corporation Regulations. The market regulator had ordered the NSE to disgorge Rs 624.89 crore with 12% interest per annum from April 2014.
The case pertains to complaints made in 2015 that the NSE gave preferential access to some co-location clients, thereby giving them a trading advantage.