XYZ Ltd. issued 12.5% debentures amounting to ₹150 crore on private placement basis during the financial year 2013. Later on, it was found that these debentures were issued to 73 persons. A Sessions Court in Mumbai took

XYZ Ltd. issued 12.5% debentures amounting to ₹150 crore on private placement basis during the financial year 2013. Later on, it was found that these debentures were issued to 73 persons. A Sessions Court in Mumbai took cognizance of the same and suo motu initiated the proceedings against XYZ Ltd. The company pleaded that the court has no locus standi in this regard and therefore, it cannot initiate any proceedings against it. As per the Securities and Exchange Board of India Act, 1992 and other relevant laws, discuss whether the company's pleading is tenable and whether the Court should drop the proceedings against the company.