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HC stays order imposing Rs 50 lakh cost on NSE

Bombay High Court

Mumbai:  The Bombay High Court today stayed for two weeks its single bench order imposing a cost of Rs 50 lakhs on National Stock Exchange (NSE) in a defamation case filed by the bourse against an online news portal.

The NSE had filed the defamation case against the portal for publishing allegedly false reports on algorithm (algo) trading mechanism on its platform.

The ad-interim relief of staying the impugned order was given by a division bench headed by Justice V M Kanade on an appeal filed by NSE seeking a review of a recent order of the High Court imposing Rs 50 lakh cost on the stock exchange.

The bench also asked the news portal to file a reply within two weeks to NSE’s revision application.

Justice Gautam Patel, while rejecting the notice of motion moved by NSE in its defamation suit, had on September 9 asked the stock exchange to pay Rs 1.5 lakh each to two persons who run the portal.

The judge had also ordered NSE to pay another Rs 47 lakh as punitive damages to Tata Memorial Hospital and Masina Hospital in Mumbai towards charity.

In its notice of motion, NSE had said the story published on the portal was defamatory to them and be withdrawn.

However, after hearing both the parties, the HC had ruled that NSE did not respond to queries sent to the bourse by the portal before publishing the story. Therefore, the stock exchange cannot say the story was defamatory.

The HC had also observed that NSE was fined since it was aware that no defamation was made out against the portal as the bourse had failed to respond to queries and yet it went ahead with filing the case thus wasting the time of the court.

Being aggrieved, NSE has moved the High Court again seeking a review of its order asking it to pay the fine.

NSE had said the report published on algo trading mechanism on its portal was not true.

The suit was filed by NSE on July 21. NSE had said that since its inception, “the NSE has been maintaining a high degree of surveillance and integrity in its daily operations and strictly adheres to the rules, regulations and guidelines issued by the regulators from time to time.”

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