Bombay High Court Sets Aside Rs 27 Crore Deposit Condition for Ketan Parekh’s Foreign Travel
In a significant relief for former stockbroker Ketan Parekh, the Bombay High Court has struck down the Securities and Exchange Board of India’s (SEBI) requirement that he deposit Rs 27 crore as a precondition to travel abroad.
The court observed that the right to travel is a fundamental right, and while it can be restricted under certain legal circumstances, such restrictions cannot be arbitrary, excessive, or unreasonable.
This judgment is expected to hold weight in future cases involving travel permissions for individuals facing prosecution, reinforcing constitutional freedoms while balancing investigative needs.
Why the Court Set Aside the Condition
The High Court noted:
Travel restrictions must be proportional, not punitive.
SEBI's demand for a deposit of Rs 27 crore had no reasonable connection to ensuring Parekh’s return.
Conditions imposed on accused individuals must not violate the right to livelihood and movement.
The court found the deposit condition excessive, unenforceable, and beyond necessity.
SEBI had earlier objected to Parekh’s travel citing ongoing proceedings and past financial irregularities. However, the court emphasised that the individual had complied with prior directives and that the deposit condition was disproportionate.
Background on the Case
Ketan Parekh, a key figure in the 2001 stock market scam, has been facing restrictions for years due to multiple legal proceedings. SEBI had opposed his request for foreign travel unless he furnished a massive financial guarantee.
The High Court’s intervention signals a shift toward more balanced, rights-centered judicial oversight of regulatory demands.
Impact of the Judgment
This ruling could influence:
Future SEBI matters involving travel permissions
Broader judicial guidelines on restrictive bail conditions
Rights of accused individuals in economic offence cases
Legal experts believe such conditions must always pass a reasonableness test, which the deposit demand failed.
Frequently Asked Questions (FAQ)
1. Why did the Bombay High Court remove the Rs 27 crore deposit condition?
Because the court found the restriction unreasonable, excessive, and in violation of the fundamental right to travel.
2. Is Ketan Parekh now free to travel abroad without conditions?
He must still follow court-approved procedural requirements, but the deposit condition no longer applies.
3. What was SEBI’s argument?
SEBI argued that Parekh’s past conduct and ongoing cases justified the deposit demand. The court disagreed with the proportionality of the restriction.
4. Does this ruling affect other financial crime accused persons?
While not binding for all cases, it sets a persuasive precedent on what constitutes unreasonable travel restrictions.
5. Why was the amount set at Rs 27 crore?
SEBI linked it to outstanding dues and penalties, but the court ruled that such financial demands cannot be imposed as travel conditions.
source credit : Sadaf Modak
Published on : 18th November
Published by : SARANYA
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