Securities Contract (Regulations) Act, 1956 (“ The Act”) – Section 23L – Listing permission for rights issue allowed – appellants participated in the rights issue – Later sought for non granting of listing permission – NSE rejected their plea – Whether NSE is right in rejecting the plea for non-grant for listing permission – Held, Yes.Brief Facts:
The appellants are investors and shareholders of Network 18 Media and Investments Limited (Network 18). They were aggrieved by the decision of the NSE, in granting listing and trading approval of the equity shares issued by Network 18 pursuant to rights issue. The grievance of the appellant was that they had made multiple representations to various entities entrusted with the responsibility of protecting interests of shareholders and investors, including SEBI complaining about violation of various rules and regulations by Network 18 relating to said rights issue. However the concerned entities failed to take necessary action to protect the interest of investors.Decision : Appeal dismissed Reason:
The appellants had participated and had benefited from the said rights issue and no prayer was made for setting aside or cancellation of the said rights issue.
The appellants failed to show how the listing permission granted by NSE by the impugned circular has affected legal right or caused any legal injury to the appellant. The appellant's grievances and representations made do not flow from the impugned circular of the NSE.
The appeal filed u/s. 23(1) of the Securities Contracts (Regulation)Act, 1956 is not maintainable as the reliefs sought by the appellants are not within the scope of the above mentioned section.