BALASAHEB KESHAWRAO BHAPKAR & ORS.versusSECURITIES AND EXCHANGE BOARD OF INDIA & ORS.

                  [2024] 7 S.C.R. 730 : 2024 INSC 525

              Balasaheb Keshawrao Bhapkar & Ors.
                                v.
           Securities and Exchange Board of India & Ors.
                     (Writ Petition (Crl) No. 546 of 2023)
                                    15 July 2024
               [Surya Kant* and K.V Viswanathan, JJ.]

                             Issue for Consideration
       Whether the facts of the case necessitated constitution of a High
       Powered Sale Committee, under Article 142 of the Constitution,
       to auction the immovable assets of the companies to satisfy the
       investors’ claims and liquidate all other statutory liabilities of the
       Companies.

                                     Headnotes†
       Constitution of India – Art.142 – Invocation of Art.142 for
       constitution of a High-Powered Sale Committee chaired by a
       former judge of the Supreme Court of India – Committee tasked
       with the responsibility of liquidating the assets to generate
       funds to satisfy claims of the investors:
       Held: Writ Petition under Article 32 of the Constitution filed by the
       Promoters/Directors of the company against which respondent- SEBI
       has initiated proceedings for illegal mobilization of funds –
       Suggestion made by counsel appearing for parties for constitution
       of High-Powered Sale Committee (HPSC) to auction the immovable
       assets of the companies, to the extent they are required to satisfy
       the investors’ claims and liquidate all other statutory liabilities of the
       Companies – Appointment of HPSC chaired by Justice Ravindra
       Bhat, former judge of the Supreme Court of India [Paras 5, 7]
       Auction – Of immovable assets of companies – Reasons for
       constitution of High-Powered Sale Committee (HPSC) – SEBI
       facing an uphill task in conducting public auctions:
       Held: Constitution of the HPSC suggested since the Petitioners
       are languishing in jail as undertrials for over 8 years – Innocent
       investors have been eagerly awaiting the refund of their hard- earned
       money for more than a decade – SEBI is facing an uphill task
       in conducting public auctions of the assets of the company in a


* Author
[2024] 7 S.C.R.                                                             731

               Balasaheb Keshawrao Bhapkar & Ors. v.
             Securities and Exchange Board of India & Ors.

     timebound manner – SEBI or MPID Court do not have the readily
     available infrastructural and strategical facilities to identify each
     property, to have fair assessment of their market value, and then
     to auction them to fetch the true market value – The conclusion
     of trials in the pending criminal cases is marred by uncertainty –
     The Petitioners have shown their bona fide towards refunding the
     investors’ amounts, and any further delay in this regard, will be
     prejudicial to one and all [Para 6]
     Auction – Of immovable assets of companies – Duties and
     responsibilities of High-Powered Sale Committee (HPSC) –
     HPSC to have powers of a civil court:
     Held: HPSC to obtain all property documents/original title deeds
     and other relevant records from the SEBI/EOW/MPID Court and
     Sub-Registrars of different States, where the properties of the
     company are located – A database of the property documents,
     along with material details, shall be created – The HPSC shall take
     necessary steps to ensure that all the properties are shown to be
     entrusted/encumbered in its favour in the State Government land
     records – The HPSC shall appoint a pool of Certified Valuers to
     evaluate the Company’s assets in each State – All the powers of a
     Civil Court in the HPSC for taking necessary actions to speed up
     the liquidation of the Companies’ properties vested and conferred
     in HPSC [Para 7(h)]

                               Case Law Cited
     National Spot Exchange Ltd. v. Union of India & Ors. (2022) SCC
     Online SC 2310; Pinak Pani Mohanty v. Union of India & Ors.
     [2023] 3 SCR 778 – referred to.
                                 List of Acts
     Constitution of India.

                              List of Keywords
     High-Powered Sale Committee; Article 142; Civil Court; Article 32;
     Sale of assets.

                              Case Arising From
     CRIMINAL ORIGINAL JURISDICTION: Writ Petition (Criminal) No.
     546 of 2023
     (Under Article 32 of The Constitution of India)
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                           Appearances for Parties
       Vinay Kumar Garg, Sr. Adv., Rajendra Singhvi, K.S. Rekhi, Parv Garg,
       Pawas Kulshrestha, Shrikant Mishra, Ms. Arundhati Chakraborty, T.
       R. B. Sivakumar, Advs. for the Petitioners.
       Avdhesh Kumar Singh, Ms. Ankita Choudhary, Deepak Thukral,
       A.A.Gs., C.U. Singh, Sr. Adv., Abhishek Baid, Mohit Kumar Bafna,
       Anup Jain, Ashok Kumar Jain (for M/S. Expletus Legal), Prashant
       Singh, Mrs. Prerna Dhall, Piyush Yadav, Anand Dilip Landge, Siddharth
       Dharmadhikari, Aaditya Aniruddha Pande, Bharat Bagla, Sourav
       Singh, Aditya Krishna, Ms. Preet S. Phanse, Adarsh Dubey, Sunny
       Choudhary, Ms. Samridhi S. Jain, Ms. Pragati Neekhra, Aditya Bhanu
       Neekhra, Aniket Patel, Ms. Ruchira Goel, Gautam Sharma, Dr. Monika
       Gusain, Advs. for the Respondents.
                  Judgment / Order of the Supreme Court

                                     Order

       Surya Kant, J.
1.     Petitioner Nos. 1 and 2 are husband and wife, whereas Petitioner
       No. 3 is their son. They have invoked the jurisdiction of this Court
       under Article 32 of the Constitution, seeking the following directions: -
            “(a) To issue appropriate writ in the nature of mandamus
                 or any direction or order directing the Respondent
                 No. 1 to liquidate the attached assets within a period
                 of 6 months and/or, in the alternative, allow the
                 Petitioners to assist Respondent No. 1 in liquidating
                 the attached assets;
            (b)   Direct Respondent No.1 to distribute the amount lying
                  within it to genuine investors as early as possible;
            (c)   Direct Respondent No. 1 to allow the Petitioners to
                  assist them in identifying genuine investors and also
                  the amount deposited by them; and
            (d)   Pass other and further order(s) as this Hon’ble Court
                  may deem fit in the facts and circumstances of the
                  case.”
2.     The above-stated reliefs have been sought in light of the following
       set of events predicated in this factual background: -
[2024] 7 S.C.R.                                                           733

                   Balasaheb Keshawrao Bhapkar & Ors. v.
                 Securities and Exchange Board of India & Ors.

     (a)   Petitioner Nos. 1 and 2 are the founder-Directors of one Sai
           Prasad Properties Ltd, incorporated under the provisions of the
           Companies Act, 1956. Petitioner No. 3 also joined the aforesaid
           company as a Director in 2008, allegedly when he was still
           studying in college, and is claimed to have thereafter resigned
           in the year 2014. The Petitioners also floated various other
           companies, known as the Sai Group of Companies, consisting of:
           (i)     M/s Sai Prasad Properties Ltd. (hereinafter, “SPPL”);
           (ii)    M/s Sai Prasad Foods Ltd. (hereinafter, “SPFL”);
           (iii) M/s Sai Prasad Corporation Ltd. (hereinafter, “SPCL”);
     (b)   The Security and Exchange Board of India (hereinafter,
           “SEBI”) received a complaint dated 02.06.2010 alleging illegal
           mobilisation of funds by SPFL. After processing the said
           complaint and in furtherance of the orders passed by the High
           Court of Madhya Pradesh and the Department of Financial
           Services, Ministry of Finance, the Whole Time Member of
           SEBI (hereinafter, “WTM”) issued an interim order-cum-show
           cause notice dated 17.07.2013, inter alia, directing SPFL and
           its Directors to refrain from collecting any more money from
           investors, under the existing schemes or any new schemes.
           SEBI, once again passed an order dated 14.01.2015 against
           SPFL and its Promotors/Directors, restraining them from
           collecting any money from the investors, launching or carrying
           out any Collective Investment Schemes, and from alienating/
           disposing/selling any of the assets of the Company, except for
           the purpose of refund to its investors.
     (c)   SEBI received a letter dated 17.08.2012 from the Registrar of
           Companies, Goa, Daman & Diu informing that upon inspection
           conducted under Section 209A of the Companies Act, 1956,
           it was found that SPPL had been accepting investments from
           their associates for a period of 4 to 9 years and had also been
           executing joint venture agreements. SEBI was then requested
           to take appropriate action against SPPL for violating Section
           11AA of the SEBI Act, 1992.
     (d)   A preliminary enquiry was conducted, and after issuing an
           interim order-cum-show cause notice dated 17.07.2013, the
           WTM vide the final order dated 14.01.2015 issued directions
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             against SPPL and its Promotors/Directors, identical to those
             passed against SPFL (mentioned in paragraph 2(b) above).
       (e)   In addition, SEBI received complaints on 23.09.2013 against
             SPCL and its sister concerns, alleging collection of money
             from the public, through the Collective Investment Schemes.
             While these complaints were under investigation, SEBI also
             received a reference from the Income Tax Department dated
             03.03.2014 alleging the collection of money from the public by
             M/s Sai Prasad Group, to the tune of Rs. 290 crores. WTM
             once again issued an interim order on 22.07.2014, followed by
             a final order dated 01.02.2016, directing SPCL and its Directors
             not to collect any money from the investors or launch or carry
             out any Collective Investment Schemes. SPCL and its Directors
             were further restrained from accessing the securities market
             and were prohibited from buying, selling, or otherwise dealing
             in the securities market for a period of four years.
       (f)   A somewhat similar complaint dated 06.10.2013 was received
             by SEBI against SSSCL, alleging the illegal mobilisation of
             funds through a joint venture participation project, which
             was in the nature of Collective Investment Schemes. Upon
             investigation, SEBI found a prima facie violation of Section
             11AA (2) of the SEBI Act. Consequently, an interim order-
             cum-show cause notice was issued on 23.01.2014, directing
             SSSCL and its Directors to abstain from collecting any money
             from the investors and from launching or carrying out any
             Collective Investment Schemes. WTM further directed SSSCL
             to wind up the existing Collective Investment Schemes, refund
             the monies collected by it under such schemes and submit a
             compliance report including the trail of funds claimed to be
             refunded, bank account statements indicating the refunds to
             investors, and replies from the investors acknowledging such
             refunds. In addition, proceedings under Chapter VI-A of the
             SEBI Act, 1992 were also initiated, and an Adjudicating Officer
             was appointed to inquire into the violations.
       (g)   It may not be necessary to refer to the subsequent events in
             relation to the four companies referred to above, except to
             say that:
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                   Balasaheb Keshawrao Bhapkar & Ors. v.
                 Securities and Exchange Board of India & Ors.

           (i)     Penalties were imposed;
           (ii)    Recovery proceedings for a sum of Rs. 30,561,041,451.69
                   (Three Thousand and Fifty-Six Crores approximately) were
                   initiated; and
           (iii) All the immovable properties and jewelleries owned by
                 the aforesaid companies were attached, including those
                 permitted to be auctioned by the MPID Court in Mumbai
                 in Case No. 7/2016.
           (iv) The MPID Court and the SEBI, vide orders dated 30.01.2017
                and 10.03.2017 respectively, attached various properties of
                the companies and jewellery items. Subsequently, through
                various orders passed from time to time, including the one
                dated 12.02.2020, SEBI attached additional properties in
                the State of Maharashtra and prevented the creation of
                any further encumbrances in all the immoveable properties
                held by the Petitioners. In furtherance, SEBI sold 100
                properties in 7 public auctions to liquidate the movable or
                immovable assets.
     (h)   Meanwhile, FIR No. 78/2015 was registered on 16.03.2015 at
           Police Sation Rajhara, District Balod, State of Chhattisgarh,
           against the Petitioners under Sections 3, 4, and 5 of the Prize
           Chits and Money Circulation Scheme (Banning) Act, 1978
           (hereinafter, “Prize Chits Act”). It appears that the Petitioners
           were arrested in that case on 27.01.2016.
     (i)   Thereafter, a series of FIRs were registered in the States of
           Chhattisgarh, Maharashtra, Madhya Pradesh, Rajasthan, Uttar
           Pradesh and Haryana. Most of these FIRs have been registered
           under Sections 406, 420 and 34 of IPC read with Sections 3, 4, 5,
           6 and 10 of the Prize Chits Act and Section 3 of the Maharashtra
           Protection of Interest of Depositors (in Financial Establishment)
           Act, 1999 (hereinafter, “MPID Act”). It appears that while 28
           FIRs have been registered in the State of Chhattisgarh, 16 FIRs
           are registered in the State of Madhya Pradesh, 11 FIRs in the
           State of Rajasthan, 2 FIRs in the State of Uttar Pradesh, and 1
           FIR in the State of Maharashtra and the State of Haryana each.
     (j)   It further appears that after the Petitioners were arrested
           on 27.01.2016 in the first case registered in the State of
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              Chhattisgarh, the Petitioner Nos. 1 and 2 still continue to be in
              custody of various courts, as a result of multiple FIRs registered
              across the country. Petitioner No. 3, however, was first released
              on bail by this Court vide order dated 15.03.2021, but was again
              arrested on 26.12.2022 by the Chhattisgarh Police in similar
              cases registered in 2016 and 2019. It appears that he was,
              however, released on bail by the Chhattisgarh High Court on
              10.04.2023 in MCRC No. 724 / 2023. Thereafter, vide the order
              dated 15.04.2024 passed in SLP (Crl.) D. No. 43363/2023, it
              has been directed that Petitioner No. 3 shall not be arrested
              in any fresh case registered against the Petitioners on the
              same or related issues. On 29.04.2024, it was further directed
              that Petitioner No.3 shall not be arrested in any of the cases
              registered against him until further orders.
3.     Having understood the facts, we shall now advert to the Petitioners’
       prayer seeking a direction to SEBI to liquidate the attached assets
       in a time-bound manner and disburse the sale proceeds to genuine
       investors as early as possible. In this regard, SEBI noted that the
       Forensic Audit conducted by the Economic Offence Wing (hereinafter,
       “EOW”) revealed that the Companies floated by the Petitioners were
       liable to refund Rs. 4700 crores, though as per the order passed
       by the WTM the refund amount was initially Rs. 3049 crores only.
       It is also not in dispute that there are 498+13 immovable properties
       owned by the companies; the details whereof have been furnished
       before the MPID Court, Mumbai. The parties are broadly ad idem
       that the entire liability of each Company regarding refund of the due
       amount to all the investors as well as various statutory, foreseen or
       unforeseen liabilities, can be extinguished from the sale proceeds
       of some of the immovable properties, if not all of them.
4.     Since the immovable properties owned by the companies are spread
       over different parts of the country, it was sensed unachievable for
       either the SEBI or the MPID Court at Mumbai, to liquidate all these
       assets through time-bound public auctions, for the reason that the
       process postulates various complex questions such as:
       (i)    What is the exact location of the immovable property in metes
              and bounds?;
       (ii)   Whether or not such property is free from encumbrances?;
[2024] 7 S.C.R.                                                            737

               Balasaheb Keshawrao Bhapkar & Ors. v.
             Securities and Exchange Board of India & Ors.

     (iii) Whether the physical possession of the subject-property is with
           one of the companies or not;
     (iv) Whether any civil dispute regarding the title/ownership of such
          property is pending before a competent forum?;
     (v)   What is the market value of the property in the event of its sale
           in a transparent manner?;
     (vi) Is there any lien of statutory tax, levy, duty, or any other charge
          attached to such property?;
     (vii) What mechanism shall be evolved for the sale of each property,
           so as to fetch the best price?; and
     (viii) What is the mandatory procedure to be followed in terms of local
            laws for the purpose of registration of the auctioned property
            and its mutation in favour of the auction purchaser, etc.
5.   Since SEBI with its bona fide pursuits to liquidate the assets and
     generate funds to satisfy the claims of investors, has already auctioned
     some of the assets, it has taken a very fair stand through its learned
     Senior Counsel, agreeing to the constitution of a High-Powered Sale
     Committee (hereinafter, “HPSC”) to auction the immovable assets of
     the companies, to the extent they are required to satisfy the investors’
     claims and liquidate all other statutory liabilities of the Companies.
     In this regard, the Petitioners, as well as SEBI, have submitted their
     comprehensive notes of suggestions to work out the modalities.
6.   We have minutely considered the valuable suggestions given by
     learned Senior Counsel/Counsel for the parties for the constitution
     of HPSC and have also kept in view exigencies such as that:
     (a)   Petitioner Nos.1 and 2 are languishing in jail as undertrials for
           over 8 years;
     (b)   Innocent investors have been eagerly awaiting the refund of
           their hard-earned money for more than a decade;
     (c)   Despite its best intentions and commitment, SEBI is facing an
           uphill task in conducting public auctions in a timebound manner;
     (d)   SEBI or MPID Court, Mumbai do not have the readily available
           infrastructural and strategical facilities to identify each property,
           to have fair assessment of their market value, and then to
           auction them to fetch the true market value;
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       (e)   The conclusion of trials in the pending criminal cases is marred
             by uncertainty; and
       (f)   The Petitioners have shown their bona fide towards refunding
             the investors’ amounts, and any further delay in this regard,
             will be prejudicial to one and all.
7.     Keeping these exceptional and peculiar circumstances in view, we
       deem it fit to invoke our powers under Article 142 of the Constitution
       of India, so as to do complete justice between the parties and hence,
       constitute the HPSC comprising of the following:
       (a)   Hon’ble Mr. Justice S. Ravindra Bhatt, Former Judge, Supreme
             Court of India – Chairperson;
       (b)   Dr. Justice Satish Chandra, Former Judge, High Court of
             Allahabad – Member;
       (c)   A nominee of SEBI who shall be an officer preferably in the
             rank of its Director – Member;
       (d)   States of Chhattisgarh, Maharashtra, Madhya Pradesh,
             Rajasthan, Uttar Pradesh and Haryana are hereby directed to
             appoint one of their officers of the Revenue Department, not
             below the rank of Collector, to assist the HPSC in relation to
             the properties situated within that State. The Collector shall be
             obligated to provide the requisite information, in writing, and
             shall sign the proceedings as State Representative;
       (e)   Mr. Pardeep Kumar Sharma, Registrar (Retd.), Supreme Court
             of India is hereby appointed as the Member Secretary-cum-
             Nodal officer of the HPSC. He shall be the Principal Custodian
             of all records and shall coordinate between the Chairperson
             and Members of the Committee as well as the State Authorities
             to give effect to the task assigned to the HPSC;
       (f)   The Deputy Secretary, Department of Home, Government of
             Maharashtra, who is the Officer in charge of the EOW, shall
             act as Secretary to the HPSC for the purpose of securing title/
             ownership records or other relevant documents from different
             States and shall be jointly responsible along with Member-
             Secretary for maintenance and custody of record;
       (g)   The HPSC may, at its discretion, associate:
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                   Balasaheb Keshawrao Bhapkar & Ors. v.
                 Securities and Exchange Board of India & Ors.

           (i)     A Chartered Accountant; or
           (ii)    A Civil Engineer; or
           (iii) An Architect; or
           (iv) Any other expert, from time to time as and when required;
     (h)   The HPSC shall:
           (i)     Firstly, obtain all property documents/original title deeds and
                   other relevant records from the SEBI/EOW/MPID Court,
                   Mumbai and Sub-Registrars of different States, where
                   the properties of M/s Sai Prasad Group of Companies
                   are located;
           (ii)    A database of the property documents, along with material
                   details, shall be created;
           (iii) Arrangements shall be made for safe storage, digitalisation,
                 and unique number marking of the property documents/
                 original title deeds and other jewellery items;
           (iv) In this regard, SEBI with the help of Stock Holding Document
                Management Services Ltd., will provide the necessary
                facilities;
     (i)   The HPSC shall take necessary steps to ensure that all the
           properties are shown to be entrusted/encumbered in its favour
           in the State Government land records;
     (j)   The HPSC shall appoint a pool of Certified Valuers to evaluate
           the Company’s assets in each State;
     (k)   We hereby confer and vest all the powers of a Civil Court in the
           HPSC for taking necessary actions to speed up the liquidation
           of the Companies’ properties;
     (l)   The HPSC, with the help of experts, will prepare a list of properties
           already sold under the supervision of the MPID Court, Mumbai,
           as well as a separate list of the properties that are yet to be sold;
     (m) The HPSC will engage/appoint e-auction service providers for
         auctioning of the assets;
     (n)   Similarly, expert agencies may be empanelled for the valuation
           of the assets for initiating the public auction process and its
           advertisement;
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       (o)    The final decision regarding the disposal of the assets shall be at
              the complete discretion of the HPSC and once the sale is made
              the property shall vest in the buyer, free from all encumbrances.
       (p)    The Petitioners or their nominees will be at liberty to join the
              auction proceedings and bring prospective buyers. They may
              submit their suggestions to the HPSC, if any. However, the
              HPSC will have full discretion to decide on those suggestions,
              and the Petitioners shall not be entitled to agitate on such issues
              before this Court or any other forum;
       (q)    The objections, if any, submitted by the Companies against
              the Forensic Audit Report and which are stated to be pending
              before the MPID Court, Mumbai, are directed to be decided
              within two months. A copy of the order shall be forwarded by
              the MPID Court to the HPSC for its information and record; and
       (r)    SEBI is directed to provide a separate account where the sale
              proceeds shall be deposited. Such account shall be jointly
              operated by the Chairperson or his nominee Member along
              with the Member, nominated by SEBI.
       Refund Process
8.     Having delineated the manner in which the HSPC will auction the
       assets and accommodate the sale proceeds in a dedicated account,
       the following process may be undertaken for the refund to investors:
       (i)    The HPSC shall identify the number of investors and database
              of such investors, in consultation with all the concerned agencies
              / State Representatives and, if so required, the Representatives
              of the Companies;
       (ii)   The HPSC shall thereafter determine the amount to be refunded
              to each investor;
       (iii) The HPSC shall determine a threshold recovery limit beyond
             which the refund process can be started;
       (iv) The HPSC shall also decide upon a category of investors based
            on their investment amount so that the refund can be done in
            a segregated and simultaneous manner;
       (v)    As already stated, the HPSC shall open an Escrow Account
              with a bank designated by SEBI, transfer all amounts from the
[2024] 7 S.C.R.                                                           741

                Balasaheb Keshawrao Bhapkar & Ors. v.
              Securities and Exchange Board of India & Ors.

            account monitored presently by the MPID Court, Mumbai, and
            deposit all sale proceeds in that interest-bearing account;
     (vi) The HPSC shall decide the nature of documents to be sought
          from the investors to determine their claims and the mode of
          application by the investors (online/physical) to determine their
          eligibility for refund, as well as the mode of refund (online/draft/
          both); and
     (vii) Investor’s claims shall be invited through a public notice that
           shall be widely publicized in one English newspaper and in one
           vernacular newspaper, popular in the State.
     Obligation of the Petitioners and their Companies
9.   Having regard to the duties and obligations to be carried out by the
     Petitioners and their companies, the following may be done:
     (i)    The Petitioners and their Companies shall forthwith submit
            details of all the immovable assets/jewellery items to the HPSC
            and shall also handover original title deeds or other relevant
            documents as may be in their possession;
     (ii)   The Petitioners and their Companies shall execute the necessary
            sale deeds within the time frame and as per the instructions of
            the HPSC after the sale is confirmed and the full consideration
            is received in the bank account to be operated by HPSC; and
     (iii) In the event of any pending title dispute, the HPSC shall
           determine the rights of the Sai Prasad Group of Companies
           in such properties for the limited purpose of auctioning them.
           Except for when there are legal impediments, such property
           shall be auctioned without any delay, and the Petitioners or the
           authorised representatives of their Companies will execute the
           necessary documents, including sale deeds, in such cases also.
     Secretarial cum Administrative requirements
10. With respect to the administrative or secretarial assistance that
    is necessitated in the course of dealing with these directions, the
    following may be adhered to:
     (i)    SEBI will assist HPSC in the opening of its office, for the purpose
            of overall coordination and receiving correspondence from the
            stakeholders. HPSC will also arrange other infrastructure and
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              may engage secretarial assistance as may be necessary for its
              smooth functioning. If the SEBI has any adequate office space
              and infrastructure at a place where the HPSC decides to set
              up its Principal Office, SEBI may provide the same without
              prejudice to its right to recover user charges, which will be
              determined by the HPSC;
       (ii)   Needless to say, the office space shall be sufficient for carrying
              out meetings, sitting of secretarial services, maintenance of
              records, etc.;
       (iii) The HPSC shall open a dedicated website for the auction /
             e-auction/advertisement / refund process etc.;
       (iv) The claims / objections / representations etc., as may be received
            by HPSC shall also be disposed of at its end;
       (v)    The HPSC shall fix a time line for every action and endeavour
              to conclude the sale process as early as possible and within
              the time frame so determined; and
       (vi) We will at this stage request the HPSC to make an endeavour
            to conclude the entire process within one year.
       Remuneration
11. Finally, keeping in mind the distinct responsibilities and obligations
    to be shouldered by the HPSC, it is imperative to also address the
    remuneration of the learned Chairperson along with all the members.
    In this regard, learned Senior counsel for the parties have referred
    to two orders passed by this Court as ‘guidelines’.
       The first order is dated 4th May, 2022 passed in Writ Petition (C)
       No.995 of 2019 (National Spot Exchange Ltd. v. Union of India &
       Ors.) wherein, a ‘Supreme Court Committee’ headed by a former
       Chief Justice of the High Court was constituted for the purpose of
       sale of the attached properties and disbursement of sale proceeds
       amongst the investors. This Court, instead of fixing the honorarium,
       observed that “the learned Judge will fix his own fee”. The second
       order dated 29th March, 2023 was passed in I.A. No.56308 of 2023
       in Writ Petition (C) No.191 of 2022 (Pinak Pani Mohanty v. Union
       of India & Ors.) wherein also a High-Powered Committee headed
       by a former Judge of this Court was constituted to supervise and
       monitor the disbursement of an amount of Rs. 5000 crores to the
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                Balasaheb Keshawrao Bhapkar & Ors. v.
              Securities and Exchange Board of India & Ors.

     depositors of the Sahara Group of Co-operative Societies. In that
     case, an honorarium of Rs. 15 lakhs per month was ordered to be
     paid to the learned former Judge of this Court, besides Rs. 5 lakhs
     per month to the learned amicus curiae.
12. Having bestowed our thoughtful consideration on these two orders
    and after taking note of the fact that the entire process in the case
    in hand might take more than a year, it seems to us that fixation of
    monthly honorarium may not be desirable. Similarly, we do not want
    to leave it for the learned Chairperson or members of the HPSC to
    fix their own honorarium as it is likely to cause embarrassment to
    them. Considering all these aspects in view, we issue the following
    directions:-
     (i)    The Chairperson of the HPSC shall be entitled to an honorarium
            of Rs. 2 lakhs per sitting day, when effective proceedings are
            held. This will be in addition to travelling, boarding and other
            miscellaneous expenses as may be incurred in discharging the
            assigned responsibilities;
     (ii)   The learned Member, who is a former Judge of the High Court
            shall be entitled to an honorarium of Rs. 1.50 lakhs per sitting
            day, when effective proceedings are held. This will be in addition
            to travelling, boarding and other miscellaneous expenses as
            may be incurred in discharging the assigned responsibilities;
     (iii) The Member nominated by SEBI shall not be entitled to any
           remuneration—since he is a full-time officer of SEBI. However, he
           shall be entitled to travelling, boarding, and other miscellaneous
           expenses as may be incurred in discharging the assigned
           responsibilities;
     (iv) The Member Secretary cum Nodal Officer of the Committee
          shall be entitled to an honorarium of Rs. 75 thousand per sitting
          day, when effective proceedings are held. This will be in addition
          to travelling, boarding and other miscellaneous expenses as
          may be incurred in discharging the assigned responsibilities;
     (v)    Remuneration of experts like Chartered Accountant, Civil
            Engineer, Architect, Certified Valuer etc. shall be determined
            by the HPSC; and
     (vi) The expenditure towards honorarium, hiring of office, secretarial
          assistance, as well as for following the prescribed procedure of
744                                                               [2024] 7 S.C.R.

                           Digital Supreme Court Reports


               auction, etc., shall be reimbursed from the sale proceeds. The
               initial expenditure shall be reimbursed from the sale proceeds
               of the properties which have already been sold, namely, the
               amount which the SEBI will transfer to the Escrow Account.
13. The States of Chhattisgarh, Maharashtra, Madhya Pradesh,
    Rajasthan, Uttar Pradesh and Haryana are hereby directed through
    their Chief Secretaries and Financial Commissioners (Revenue), to
    extend full cooperation and provide complete assistance as may be
    required by the HPSC for the purpose of execution and fulfilment
    of the assigned task. There must not be any delay on their part to
    comply with the instructions as may be received from the Chairperson
    of the HPSC.
14. Similarly, the Directors General of Police of the above-mentioned
    States are directed to provide assistance, if so required for the
    purpose of securing and protecting possession of the properties of
    the Companies.
15. In addition, the HPSC, if so required, may deploy private guards for
    the protection of the properties of the Companies.
16. SEBI and the Petitioners are also directed to extend full cooperation
    to the HPSC.
17. To facilitate the sale and disbursement process and keeping in mind
    the period of incarceration already undergone, Petitioner Nos. 1 and
    2 are directed to be enlarged on interim bail to the satisfaction of
    the MPID Court, Mumbai in Case No. 7 / 2016. This will be treated
    as interim bail in all of the FIRs. We order this on the basis of the
    special facts of the case, in exercise of our power under Article 142
    of the Constitution of India.
18. The HPSC shall be at liberty to seek further guidelines or clarifications
    as may be required, for which its Member Secretary cum Nodal Officer
    shall be at liberty to move an appropriate application before this Court.

       Result of the case: Directions issued.



       †
           Headnotes prepared by: Mukund P Unny, Hony. Associate Editor
                                   (Verified by: Liz Mathew, Sr. Adv.)