LexVENEET AGRAWAL versus UNION OF INDIA AND ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
y
A
VENEET AGRAWAL
V.
UNION OF INDIA AND ORS.
OCTOBER 31, 2007
B
[ASHOK BHAN AND V.S. SIRPURKAR, JJ.]
A
""
Securities and Exchange Board of India Act, 1992:
c
S. 31-Constitutionality and vi res of 199 2 Rules and Regulations
challenged on the ground that procedure mandated under s. 31 was not
complied with-Held: It was not necessary for rules/regulations to be
re-laid in the next sessions as requisite period of 30 days was to be
completed in one or more sessions-Hence rules/regulations ajter
D having been initially laid are deemed to lie in succeeding sessions till
completion of 30 days-Requirement of s. 31 has been thus met-Rules/
~t'
regulations cannot be declared ultra vires on this ground-Even
otherwise, provisions of s. 31 not being mandatory and merely directory,
rules/regulations made thereunder cannot be held to be ultra vires-
E
SEBI (Stock Brokers and Sub Brokers) Rules and Regulations, 199 2-
Rules of Procedure and Conduct of Business in Lok Sabha-Rule 234.
The challenge in these appeals is relating to the vires and
constitutionality ofSEBI (Stock Brokers and Sub Brokers) Rules
and Regulations, 1992 on the ground that these Rules and
F
regulations in question were laid on the table of the Lok Sabha on
)""'
27.11.1992 while on the table of the Rajya Sabha on 16.12.1992 and
the proceedings lapsed after the adjournment of the House sine die
and since the rules and regulations were not re-laid either in the Lok
Sabha or in the Rajya Sabha after the calling of the new session,
G the procedure mandated under s.31 of the SEBI Act was not complied
with.
~
Before different High Courts, various writ petitions were filed
challenging the levy of turnover fee as well as thevires of Regulation
H
740
I .,
I
I
VENEET AGRAWAL v. UNION OF INDIA
741
..,.
10. In a transfer petition filed by the SEBI before this Court for A
consolidating the said cases, this Court had transferred one such
petition from the Bombay High Court to this Court while staying the
other cases pending before the various High Courts. After hearing
the said case, this Court had upheld the vires of Regulation 10 of
SEBI Regulation as well as the levy of turnover fee. On the basis of B
,A
the judgment rendered by this Court, all other similar writ petitions
pending in the various High Courts were disposed off. Having failed
.J
in their challenge to the levy of turnover fee, the brokers and sub
brokers have repeatedly been filing petitions on one or other grounds
while their actual grievance is the turnover fee imposed by c
Regulation lOwhich has been upheld by this Court. In thewritpetition
from which the present appeal arises, similar attempt has been
made.
Dismissing the appeals, the Court
HELD: 1.1. Laying of the rules/regulations framed under a D
~
pa1iicular statute for a specific period which that particular statute
may warrant is governed by the Rules of Procedure and Conduct of
Business in Lok Sabha. As per Rule 234 of these Rules, the rules
and regulations were required to be placed before both the Houses
of Parliament for a specified period and ifthe House is adjourned E
sine die and later prorogued, the procedure has to be completed in
one or more sessions, unless otherwise provided under the
Constitution or the relevant Act. In the facts and circumstances of
the case, Rule 234(1) is applicable.
('.
[Paras 8, 9and11] (746-C, D; 747-E, F; 746-G] F
1.2. S.31 specifically provides that the Bill has to be placed
before both the Houses for a period of thirty days which may be
comprised in one session or in two or more successive sessions. The
regulation, rule, sub-rule, bye law etc. have to be re-laid in the
succeeding session or sessions until the said period is completed in G
.,).
one session. The position has been further clarified by the Rajya
Sabha Secretariat in its letter dated 9.10.2002 wherein the
Secretariat has clarified that in the case of rules and regulations
underS.31 of the SEBI Act, no relaying was necessary as the statute
permitted the requisite period of 30 days to be completed in one or H
A
a
c
D
E
742
SUPREME COURT REPORTS
[2007] 11 S.C.R.
more sessions and therefore, the rules/regulations in question after
having been initially laid are deemed to lie in the succeeding sessions
till the specified period is completed. Besides this the Ministry of
Parliamentary Affairs by its letter dated 9.10.2002 further clarified
that no modificatiExcerpt shown. Read the full judgment & AI analysis in Lexace.