SAT STAYS SEBI’S ORDER AGAINST HDFC BANK IN BRH WEALTH CASE

NEW DELHI: The Securities Appellate Tribunal (SAT) has stayed a Sebi order which imposed a fine of ₹1 crore on HDFC Bank for invoking securities pledged by stock broker BRH Wealth Kreators, till further orders.

Sebi had imposed the fine and also directed the bank on January 21 to transfer ₹158.68 crore along with 7% interest per annum into an escrow account till the issue of settlement of clients’ securities is reconciled.

“The fact that the circulars have been violated or not and whether the securities have been rightly invoked by the appellant requires consideration,” the tribunal said in an order dated February 19 while giving three weeks time to Sebi to file a reply.

The tribunal in its order noted that HDFC Bank is one of the largest private sector bank and as per balance sheet it has assets of ₹1,654,228 crore and therefore has sufficient financial strength and ability to furnish the amount as per the impugned order. It is not a case where the bank will run away or will become insolvent, it added.

“We accordingly stay the effect and operation of the impugned order till further orders of the Tribunal subject to the condition that appellant will give an undertaking to Sebi that they will abide by the result of the appeal and the directions given therein within four weeks from the date of the disposal of the appeal. Such undertaking shall be given by a responsible officer of the appellant to be filed before Sebi within two weeks from today,” the tribunal said.