Securities Appellate Tribunal (SAT) seeks replies from Emkay Global and National Stock Exchange (NSE) on the stock market crash that took place in October 2012.
Hearing brokerage firm Emkay Global’s plea against NSE in the Nifty flash crash case, the Securities and Appellate Tribunal today asked them to file their replies by July 26 and adjourned the matter till August 29.
Emkay had approached SAT after the National Stock Exchange refused to accept its request for annulment of erroneous trades it had carried out in October 2012.
At today’s hearing, Emkay also sought a copy of the showcause notice served by market regulator Sebi to NSE in this matter. The said notice was sent by Sebi in June, in reply to which the exchange has already made its submissions before the regulator.
Sebi had sought to know why action should not be taken against NSE as well in the case, while the exchange has been maintaining that the flash crash took place entirely because of errors at the broker’s end.
The tribunal today asked both the parties — Emkay and NSE — to reply by July 26.
In October 2012, certain erroneous orders entered by a dealer of brokerage firm Emkay Global led to a flash-crash of over 900 points in the NSE’s benchmark index Nifty, forcing the exchange to temporarily halt the trading.
These erroneous trades had led to a massive plunge of over 15 percent in the NSE’s benchmark index Nifty, prompting a temporary halt in overall market trading.
Emkay had to bear the losses, amounting to about Rs 51 crore, caused by this trade, but the brokerage firm later requested for annulment of the trade terming it as a one-off error. These losses are higher than market value of Emkay Global, which stands at Rs 45 crore.