Kotak Securities: Kotak Sec moves Bombay High Court against NSE directive


Kotak Securities, a subsidiary of Kotak Mahindra Bank, has approached the Bombay High Court, seeking its intervention for setting aside a circular and an order issued by the National Stock Exchange (NSE) that directed the company to liquidate its positions worth more than ₹624 crore in four of its affiliated entities.

The company has also made the capital markets regulator, the Securities & Exchange Board of India (Sebi), a party in the case.

The division bench of Justice GS Kulkarni and Justice Jitendra Jain has allowed all the respondents to file their responses in the case and has posted the hearing for January 16. As per the court’s website, Kotak Sec filed the case on November 24.

The genesis of the dispute lies in the circular issued by the stock exchange on January 7, 2022. The NSE later issued an order on October 13, 2023, directing the company to submit a plan within 45 days regarding the divestment of four of its long-standing investments to the tune of ₹624.66 crore.

These investments are in the form of equity and debentures acquired by Kotak Securities between 2007 and 2017 in four group entities – Kotak Mahindra Prime Ltd, Kotak Mahindra Financial Services Ltd, Kotak Mahindra Investments Ltd and Kotak Infrastructure Debt Fund Ltd.

“The matter is sub judice. Hence, the company cannot offer any comments in this regard,” said a Kotak Securities spokesperson in a response to ET’s query.

In this case, senior counsels Darius Khambata and Sharan Jagtiani along with law firm AZB & Partners are appearing for Kotak Securities. Senior Advocate Venkatesh Dhond and Shruti Rajan of Trilegal are appearing for the NSE. Sebi is being represented by Senior Counsel Rafique Dada and Nishit Dhruva of MDP & Partners.Kotak Securities has argued that the NSE would not have the authority in law, to issue the January 7, 2022, circular, which it said modifies the statutory rules – the Security Contract (Regulations) Rules, 1957.



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