1. Short title and commencement.—(1) This Act may be called the Special Court (Trial of Offences
Relating to Transactions in Securities) Act, 1992.
(2) It shall be deemed to have come into force on the 6th day of June, 1992.
2. Definitions.—In this Act, unless the context otherwise requires,—
(a) “Code” means the Code of Criminal Procedure, 1973 (2 of1974);
(b) “Custodian” means the Custodian appointed under sub-section(1) of section 3;
(c) “securities” includes—
(i) shares, scrips, stocks, bonds, debentures, debenture stock, units of the Unit Trust of India
or any other mutual fund or other marketable securities of a like nature in or of any incorporated
company or other body corporate;
(ii) Government securities; and
(iii) rights or interests in securities;
(d) “Special Court” means the Special Court established under sub-section (1) of section 5.
3. Appointment and functions of Custodian.—(1) The Central Government may appoint one or
more Custodians as it may deem fit for the purposes of this Act.
(2) The Custodian may, on being satisfied on information received that any person has been involved
in any offence relating to transactions insecurities after the 1st day of April, 1991 and on and before the
6th June, 1992, notify the name of such person in the Official Gazette.
(3) Notwithstanding anything contained in the Code and any other law for the time being in force, on
and from the date of notification under sub-section (2), any property, movable or immovable, or both,
belonging to any person notified under that sub-section shall stand attached simultaneously with the issue
of the notification.
(4) The property attached under sub-section (3) shall be dealt with by the Custodian in such manner
as the Special Court may direct.
(5) The Custodian may take assistance of any person while exercising his powers or for discharging
his duties under this section and section 4.
4. Contracts entered into fraudulently may be cancelled.—(1) If the Custodian is satisfied, after
such inquiry as he may think fit, that any contract or agreement entered into at any time after the 1st day
of April, 1991 and on and before the 6th June, 1992 in relation to any property of the person notified
under sub-section (2) of section 3 has been entered into fraudulently or to defeat the provisions of this
Act, he may cancel such contract or agreement and on such cancellation such property shall stand
attached under this Act:
Provided that no contract or agreement shall be cancelled except after giving to the parties to the
contract or agreement a reasonable opportunity of being heard.
(2) Any person aggrieved by a notification issued under sub-section (2) of section 3 or any
cancellation made under sub-section (1) of section 4 or any other order made by the Custodian in exercise
of the powers conferred on him under section 3 or 4 may file a petition objecting to the same within thirty
days of the assent to the Special Court (Trial of Offences Relating to Transactions in Securities) Bill,
1992 by the President before the Special Court where such notification, cancellation or order has been
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issued before the date of assent to the Special Court (Trial of Offences Relating to Transactions in
Securities)Bill, 1992 by the President and where such notification, cancellation or order has been issued
on or after that date, within thirty days of the issuance of such notification, cancellation or order, as the
case may be; and the Special Court after hearing the parties, may make such order as it deems fit.
5. Establishment of Special Court.—(1) The Central Government shall, by notification in the
Official Gazette, establish a Court to be called the Special Court.
(2) The Special Court shall consist of 1
[one or more sitting Judges] of the High Court nominated by
the Chief Justice of the High Court within the local limits of whose jurisdiction the Special Court is
situated, with the concurrence of the Chief Justice of India.
2
[(3) When the office of 3
[a Judge of the Special Court] is vacant by reason of absence or leave, the
duties of the office shall be performed by such Judge of the High Court within the local limits of whose
jurisdiction the Special Court is situated as the Chief Justice of that High Court may, with the concurrence
of the Chief Justice of India, nominate for the purpose and the Judge so appointed shall have all the
jurisdiction and powers of 3
[a Judge of the Special Court] including the powers to pass final orders.]
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[5A.Distribution of cases amongst Judges of Special Court.—Where the Special Court consists of
two or more Judges, the Chief Justice of the High Court within the local limits of whose jurisdiction the
Special Court is situated may, from time to time, by general or special order, make provisions as to the
distribution of cases amongst the Judges and specify the matters which may be dealt with by each of such
Judge.]
6. Cognizance of cases by Special Court.—The Special Court shall take cognizance of or try such
cases as are instituted before it or transferred to it as hereinafter provided.
7. Jurisdiction of Special Court.—Notwithstanding anything contained in any other law, any
prosecution in respect of any offence referred to in sub-section (2) of section 3 shall be instituted only in
the Special Court and any prosecution in respect of such offence pending in any court shall stand
transferred to the Special Court.
8. Jurisdiction of Special Court as to joint trials.—The Special Court shall have jurisdiction to try
any person concerned in the offence referred to in sub-section (2) of section 3 either as a principal,
conspirator or abettor and all other offences and accused persons as can be jointly tried therewith at one
trial in accordance with the Code.
9. Procedure and powers of Special Court.—(1) The Special Court shall, in the trial of such cases,
follow the procedure prescribed by the Code for the trial of warrant cases before a magistrate.
(2) Save as expressly provided in this Act, the provisions of the Code shall, in so far as they are not
inconsistent with the provisions of this Act, apply to the proceedings before the Special Court and for the
purposes of the said provisions of the Code, the Special Court shall be deemed to be a Court of Session
and shall have all the powers of a Court of Session, and the person conducting a prosecution before the
Special Court shall be deemed to be a Public Prosecutor.
(3) The Special Court may pass upon any person convicted by it any sentence authorised by law for
the punishment of the offence of which such person is convicted.
(4) While dealing with any other matter brought before it, the Special Court may adopt such
procedure as it may deem fit consistent with the principles of natural justice.
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[9A. Jurisdiction, powers, authority and procedure of Special Court in civil matters.—(1) On
and from the commencement of the Special Court (Trial of Offences Relating to Transactions in
Securities) Amendment Act, 1994 (24 of 1994) the Special Court shall exercise all such jurisdiction,
powers and authority as were exercisable, immediately before such commencement, by any civil court in
relation to any matter or claim—
(a) relating to any property standing attached under sub-section(3) of section 3;
1. Subs. by Act 6 of 1997, s. 2 for “a sitting Judge”(w. e. f. 16-1-1997).
2. Ins. by Act 24 of 1994, s. 2(w. e. f. 25-1-1994).
3. Subs. by Act 6 of 1997, s. 2, for “the Judge of the Special Court” (w. e. f. 16-1-1997).
4. Ins. by s. 3, ibid. (w. e. f. 16-1-1997).
5. Ins. by Act 24 of 1994, s. 3 (w. e. f. 25-1-1994).
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(b)arising out of transactions in securities entered into after the1st day of April, 1991, and on or
before the 6th day of June, 1992, in which a person notified under sub-section (2) of section 3 is
involved as a party, broker, intermediary or in any other manner.
(2) Every suit, claim or other legal proceeding (other than an appeal) pending before any court
immediately before the commencement of the Special Court (Trial of Offences Relating to Transactions
in Securities)Amendment Act, 1994 (24 of 1994), being a suit, claim or proceeding, the cause of action
whereon it is based is such that it would have been, if it had arisen after such commencement, within the
jurisdiction of the Special Court under sub-section (1), shall stand transferred on such commencement to
the Special Court and the Special Court may, on receipt of the records of such suit, claim or other legal
proceeding, proceed to deal with it, so far as may be, in the same manner as a suit, claim or legal
proceeding from the stage which was reached before such transfer or from any earlier stage or de novo as
the Special Court may deem fit.
(3) On and from the commencement of the Special Court (Trial of Offences Relating to Transactions
in Securities) Amendment Act, 1994 (24 of 1994), no court other than the Special Court shall have, or be
entitled to exercise, any jurisdiction, power or authority in relation to any matter or claim referred to in
sub-section (1).
(4) While dealing with cases relating to any matter or claim under this section, the Special Court shall
not be bound by the procedure laid down by the Code of Civil Procedure, 1908 (5 of 1908), but shall be
guided by the principles of natural justice, and subject to the other provisions of this Act and of any rules,
the Special Court shall have power to regulate its own procedure.
(5) Without prejudice to the other powers conferred under this Act, the Special Court shall have, for
the purposes of discharging its functions under this section, the same powers as are vested in a civil court
under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the following
matters, namely:—
(a) summoning and enforcing the attendance of any person and examining him on oath;
(b) requiring the discovery and production of documents;
(c) receiving evidence on affidavits;
(d) subject to the provisions of sections 123 and 124 of the Indian Evidence Act, 1872
(1 of 1872), requisitioning any public record or document or copy of such record or document from
any office;
(e) issuing commissions for the examination of witnesses or documents;
(f) reviewing its decisions;
(g) dismissing a case for default or deciding it ex parte;
(h) setting aside any order of dismissal of any case for default or any order passed by it ex parte;
and
(i) any other matter which may be prescribed by the Central Government under sub-section (1) of
section 14.
9B. Powers of the Special Court in arbitration matters.—(1) The Special Court shall have the
jurisdiction and powers of a Court conferred under the Arbitration Act, 1940 (10 of 1940) to decide any
question forming subject matter of a reference relating to any matter or claim mentioned in sub-section
(1) of section 9A.
(2) Every suit or other proceeding (other than an appeal) in relation to any matter or claim referred to
in sub-section (1) of section 9A pending before any Court and governed by the Arbitration Act, 1940
(10 of 1940), immediately before the date of commencement of the Special Court (Trial of Offences
Relating to Transactions in Securities) Amendment Act, 1994 (24 of 1994) shall stand transferred on that
date to the Special Court.
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Explanation.—For the purposes of this section, the expressions “Court” and “reference” shall have
respectively the same meanings as defined under clauses (c)and (e)of section 2 of the Arbitration Act,
1940 (10 of 1940).]
10. Appeal.—(1) Notwithstanding anything in the Code 1
[or the Code of Civil Procedure,1908
(5 of 1908) or the Arbitration Act, 1940 (19 of1940)], an appeal shall lie from any judgment 1
[,decree]
sentence or order, not being interlocutory order, of the Special Court to the Supreme Court both on facts
and on law.
(2) Except as aforesaid, no appeal or revision shall lie to any Court from any judgment 1
[,decree]
sentence or order of the Special Court.
(3) Every appeal under this section shall be preferred within a period of thirty days from the date of
any judgment, sentence or order of the Special Court:
Provided that the Supreme Court may entertain an appeal after the expiry of the said period of thirty
days if it is satisfied that the appellant had sufficient cause for not preferring the appeal within the period
of thirty days.
11. Discharge of liabilities.—(1) Notwithstanding anything contained in the Code and any other law
for the time being in force, the Special Court may make such order as it may deem fit directing the
Custodian for the disposal of the property under attachment.
(2) The following liabilities shall be paid or discharged in full, as far as may be, in the order as
under:—
(a) all revenues, taxes, cesses and rates due from the persons notified by the Custodian under
sub-section (2) of section 3 to the Central Government or any State Government or any local
authority;
(b) all amounts due from the person so notified by the Custodian to any bank or financial
institution or mutual fund;
(c) any other liability as may be specified by the Special Court from time to time.
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[11A. Power to punish for contempt.—The Special Court shall have, and exercise, the same
jurisdiction, powers and authority in respect of contempt of itself as a High Court has and may exercise
and, for this purpose, the provisions of the Contempt of Courts Act, 1971 (70 of 1971), shall have effect
subject to the modifications that—
(a) the references therein to a High Court shall be construed as including a reference to such
Special Court;
(b) the references to the Advocate-General in section 15 of the said Act, shall be construed, in
relation to the Special Court, as a reference to the Attorney-General or the Solicitor-General or the
Additional Solicitor-General.]
12. Protection of action taken in good faith.—(1) No suit, prosecution or other legal proceeding
shall lie against the Central Government or the Custodian for anything which is in good faith done or
intended to be done under this Act.
(2) No suit or other legal proceeding shall lie against the Central Government or any of its officers or
other employees for any damage caused or likely to be caused by anything which is in good faith done or
intended to be done under this Act.
13. Act to have overriding effect.—The provisions of this Act shall have effect notwithstanding
anything inconsistent therewith contained in any other law for the time being in force or in any instrument
having effect by virtue of any law, other than this Act, or in any decree or order of any court, tribunal or
other authority.
1. Ins. by Act 24 of 1994, s. 4 (w. e. f. 25-1-1994).
2. Ins. by s. 5, ibid. (w. e. f. 25-1-1994).
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14. Power to make rules.—(1) The Central Government may, by notification in the Official Gazette,
make rules for carrying out the provisions of this Act.
(2) Every rule made by the Central Government under this Act shall be laid, as soon as may be after it
is made, before each House of Parliament, while it is in session, for a total period of thirty days which
may be comprised in one session or in two or more successive sessions, and if, before the expiry of the
session immediately following the session or the successive sessions aforesaid, both Houses agree in
making any modification in the rule or both Houses agree that the rule should not be made, the rule shall
thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that
any such modification or annulment shall be without prejudice to the validity of anything previously done
under that rule.
15. Repeal and savings.—(1) The Special Court (Trial of Offences Relating to Transactions in
Securities) Ordinance, 1992 (Ord. 10 of 1992) is hereby repealed.
(2) Notwithstanding such repeal, anything done or any action taken under the said Ordinance, shall be
deemed to have been done or taken under the corresponding provisions of this Act.