Case: M/S PRRSAAR THROUGH ITS PROPRIETOR VED PRAKASH GUPTA Vs. NATIONAL STOCK EXCHANGE OF INDIA LTD

3. This appeal takes exception to the order dated 20.02.2017 passed by the Securities Appellate Tribunal at Mumbai in Misc. Application No.49 of 2017 and in Appeal No.53 of 2017, whereby the Appellate Tribunal rejected the appeal preferred against the order dated 03.02.2017 passed by the Disciplinary Action Committee of National Stock Exchange of India Ltd. which found the appellant guilty of indulging in financial irregularities and misconduct in conduct of business, and for which a fine/penalty of Rs.10 lakhs with suspension from trading membership of the appellant for five trading days came to be imposed.

Reasoning:
7. After considering the rival submissions, it is noticed that the appellant had specifically raised the issue about the appropriateness of the order suspending the trading membership of the appellant and also regarding the quantum of penalty imposed by the appropriate authority. That can be discerned from the contention recorded in paragraph 3 of the impugned order which, inter alia, reads thus:?... He submitted that the decision of the DAC of NSE is in violation of NSE Circular dated June 27, 2013, because, as per that circular suspending the trading is not contemplated for the violations allegedly committed by the appellant...?8. The Appellate Tribunal, however, has not examined this contention but proceeded to reject the appeal on the specious ground that the penalty imposed by the appropriate authority cannot be said to be unreasonable or excessive. The argument of the appellant was that even though the appropriate authority can suspend the trading membership of the member indulging in misconduct, it can be resorted to only when it falls within the concerned Bye-law such as Bye-law 8(a) relied upon by the respondent - which envisages that the trading member must conduct business ?in a manner prejudicial to the Exchange? etc. Further, the penalty could not have exceeded an amount of Rs. 1 lakh or 0.1% of the value of misuse, whichever is higher. These arguments have not been dealt with by the Appellate Tribunal at all.