SC declines to quash criminal defamation against NSE
BS Reporter / Mumbai Apr 27, 2010, 17:13 IST
The Supreme Court on Monday declined to quash criminal defamation case against the National Stock Exchange (NSE) filed by one of its former employees, who is now a senior executive with rival MCX group.
The court dismissed the Special Leave petition filed by NSE requesting to quash the orders of the Mumbai High Court. The Mumbai court had refused to quash the defamation complaint filed by MCX vice president A Sebastin and ordered three top NSE officials to either issue a public apology in leading newspapers or stand trial before the Mumbai Metropolitan Magistrate Court.
The case relates to defamation of Sebastin, working as compliance officer with NSE. In its order on March 25, Justice B R Gavai found a prima facie case of defamation by NSE and asked its managing director Ravi Narain, deputy managing director Chitra Ramkrishna and head of human resource Ram Surve to face trial under section 500 of Indian Penal Code for defaming Sebastien.
On 6th April 2009, the NSE issued a ’public notice‘ in all leading business newspapers with Sebastien's photograph announcing that anyone dealing with the “said Mr. A Sebastin” would do so at their own risk as he was terminated from service with NSE. NSE stated that Sebastien's service was terminated as had not met the company’s requirements.
Sebastien, however, filed a defamation case against NSE and its officials by claiming that his service was not terminated but he had voluntarily resigned and the newspaper advertisements had maligned his image.
Normally, such notices are published only if an employee is guilty of financial fraud or a serious betrayal of trust. However, there is no such mention. Instead, NSE issued a clarification responding to media queries saying that Sebastin’s services were terminated as he fained to meet company’s requirements. It also indicated, without being specific, that the employee had failed to complete 'severance' formalities.
Sebastien, however, claimed to have evidence of a formal handover of charge, an exit interview and an email assurance that he would be relieved. He says that the public notice was issued after he sent a legal notice to the NSE on 4th April demanding severance benefits like Provident Fund (PF) and gratuity.
Holding back PF is not legal, so the NSE reportedly credited his PF account immediately after he served the legal notice but simultaneously issued him a termination letter followed by the public notice, almost six months after he had quit the Exchange.
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