Now coming to the Appellant's role in the context of action against two members who had allegedly procured membership of the exchange by producing fake certificates, it is very difficult to exonerate the Appellant from the charges levelled against him as the sequence of events establish that he had failed to act properly and reasonably in the matter. The Appellant's version that since that the original files were not handed over to him he could not attend to the matter is worth discarding as demonstrated by his conduct. The conduct of the Appellant leading a walkout from the meeting of the Governing Board held on 17.5.2000 and amending the minutes of the said meeting by him cannot be viewed lightly in the context of the over all conduct of the Appellant in the matter. Despite the fact that the Appellant had assured Chairman of the SEBI in a meeting held on 14.2.2000 that the files would be traced out and necessary action would be taken against the members when the matter came up for discussion in the meeting of the Board held on 17.5.2000 chaired by him, he staged a walk out, obviously with a view to debilitate the Governing Board taking any action in the matter. He did not stop there. He was fully aware of the fact that the case of the said two members procuring membership allegedly by producing fake certificates, was very much alive and the Respondent had asked the Appellant to take action, in a Board meeting chaired by him held on 26.5.2000, in which the representatives of the Respondent and other public representatives were absent, a resolution was passed, rectifying and reconfirming the decision of the Board taken in the meeting held on 6.10.1997 wherein the elected members of the Governing Board had waived the requirement of minimum educational qualification of the said two members, with a view to allow them to continue with their membership, obviating the need for prescribed qualification. It is seen from the conduct of the Appellant, as explained by the Respondent, remaining unrebutted, the Appellant had informed the Governing Board that it was not desirable to raise the issues concerning the said two members' eligibility qualifications in any Board meeting as it was fully concluded in the meeting of the Board held on 6.10.1997 and in the meeting held on 26.5.2000 chaired by him in the absence of the SEBI nominee Directors and Public Representative Directors, it was decided that no further discussion on the issue of the validity of membership of the said Shri R.K. Garg and Shri D.K. Gupta should take place in the Board meeting as the same stood concluded and closed. There is no explanation from the Appellant justifying the need to take such a decision, especially when non-elected nominee directors representing public interest and SEBI were not present in the meeting. In this context it is to be remembered that at that point of time there was no restraint order from the High Court, before the Appellant. It is evident that the Appellant was thwarting action against the said two members, who were facing the grave charge of producing fake certificates to procure membership. The Appellant's role, as it emerges from his conduct cannot be viewed leniently. As President of the exchange he was expected to probe into the matter to reach at the truth and take suitable action, instead of attempting to hush up the matter on technical grounds.
