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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
SANDEEP V.MARNE
Sharekhan Limited – Appellant
Versus
Monita Kisan Khade – Respondent
| Table of Content |
|---|
| 1. investors authorized third-party trades. (Para 1 , 2 , 4 , 5 , 6) |
| 2. petitioner's argument against liability based on regulatory non-compliance. (Para 10 , 11 , 12 , 13) |
| 3. authorized persons' role in stock trading. (Para 14 , 15 , 16 , 17) |
| 4. implications of sebi circular on stock brokers. (Para 18 , 19 , 20 , 21) |
| 5. non-compliance with regulations doesn't negate broker liability. (Para 26 , 27 , 28 , 29 , 30) |
| 6. damages must be proven, not arbitrarily assigned. (Para 31 , 32 , 33 , 34) |
| 7. awards set aside due to unsustainability. (Para 35 , 36) |
JUDGMENT :
SANDEEP V. MARNE, J.
1) This is yet another case of investors seeking to recover from stockbroker losses incurred in trades executed by their trusted person taking advantage of the stockbroker’s failure to maintain pre and post trade confirmations. Can stockbroker be made liable to bear the losses incurred by a client in trades in respect of which the stockbroker has failed to follow regulatory Circular issued by Securities and Exchange Board of India is the question this Court is tasked upon to decide in the present Petitions.
2) The Petitions are filed by the Petitioner challenging the Awards passed by the three Membe
Stockbroker liability for losses in trades hinges on adherence to SEBI Circulars; regulatory violations alone do not create client compensation rights without proof of actual loss.
Absence of prior written instructions does not absolve a client of liability for trades if evidence shows active participation and knowledge.
A depository is liable to indemnify investors for losses due to negligent acts of its Depository Participant, demonstrating the interconnected responsibilities of financial institutions in preventing....
The court emphasized the finality of the Arbitral Tribunal's evaluation of evidence and material, and upheld the findings based on an independent conclusion.
Arbitrators must decide disputes based on contractual terms, not arbitrary notions of fairness; unsubstantiated regulatory violations cannot justify halving awarded amounts when parties knowingly eng....
Profits from trades executed on erroneously credited margin belong to the client, not the broker, as retention by the broker amounts to unjust enrichment.
A client must adhere to contractual obligations regarding annual maintenance charges for reduced brokerage rates; failure to do so results in automatic application of normal charges.
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