In Brief
A securities trader (Prakash Gupta) sought to compound a criminal offence under Section 24(1) of the SEBI Act, 1992 involving alleged fraudulent trading practices. The High Court rejected the application, holding that SEBI's consent was mandatory. The Supreme Court clarified that while the statute does not expressly require SEBI's consent, courts must obtain and give substantial weight to SEBI's expert views on whether compounding is appropriate, particularly where investor protection and market stability are implicated. Here, SEBI's expert committee reasonably opposed compounding given the serious nature of the allegations, so the appeal was dismissed.
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