Section 15JB of The Securities and Exchange Board of India Act, 1992
- (1)Notwithstanding anything contained in any other law for the time being in force, any person, against whom any proceedings have been initiated or may be initiated under section 11, section 11B, section 11D, sub-section (3) of section 12 or section 15-I, may file an application in writing to the Board proposing for settlement of the proceedings initiated or to be initiated for the alleged defaults.
- (2)The Board may, after taking into consideration the nature, gravity and impact of defaults, agree to the proposal for settlement, on payment of such sum by the defaulter or on such other terms as may be determined by the Board in accordance with the regulations made under this Act.
- (3)The settlement proceedings under this section shall be conducted in accordance with the procedure specified in the regulations made under this Act.
- (4)No appeal shall lie under section 15T against any order passed by the Board or adjudicating officer, as the case may be, under this section.] 7[(5) All settlement amounts, excluding the disgorgement amount and legal costs, realised under this Act shall be credited to the Consolidated Fund of India.] CHAPTER VIB ESTABLISHMENT, JURISDICTION, AUTHORITY AND PROCEDURE OF 8[SECURITIES APPELLATE TRIBUNAL]
Summary
- A person facing administrative or civil proceedings can apply to settle the matter.
- The board can agree to a settlement after considering the nature, gravity, and impact of the defaults.
- A settlement involves paying a sum of money or agreeing to other terms set by the board.
- Once a settlement order is passed, the person cannot appeal it.
- Settlement amounts go to the Consolidated Fund of India, except for disgorgement amounts (giving up illegal profits) and legal costs.
Practical examples
FAQ
1. Can I settle a case before proceedings have even officially started?
Yes, applications can be filed for proceedings that have been initiated or may be initiated.
2. What factors does the board look at before agreeing to a settlement?
The board considers the nature, gravity, and impact of the defaults.
3. If I am unhappy with the final settlement order, can I appeal it?
No, the law states that no appeal shall lie against any order passed under this settlement section.
4. Do all the settlement funds go to the government?
All settlement amounts go to the Consolidated Fund of India, but disgorgement amounts and legal costs are excluded from this rule.
Test yourself
Q1.Under Section 15JB of The Securities and Exchange Board of India Act, 1992, what happens if a person wishes to appeal a settlement order they agreed to?
Q2.Under Section 15JB of The Securities and Exchange Board of India Act, 1992, which of the following amounts from a settlement are NOT credited to the Consolidated Fund of India?
Q3.Section 15JB of The Securities and Exchange Board of India Act, 1992 allows settlement for proceedings under Section 11D. What does Section 11D specifically allow the board to do?
Q4.Under Section 15JB of The Securities and Exchange Board of India Act, 1992, what must the board take into consideration before agreeing to a settlement proposal?
Q5.Under Section 15JB of The Securities and Exchange Board of India Act, 1992, which other provision's power to issue directions and levy penalties is explicitly cross-referenced as eligible for settlement?