Write short note on compounding of offences under SEBI Act, 1992.

According to Section 24 A of the SEBI Act, 1992 permits compounding of offences by the court where prosecution proceedings are pending. Compounding is essentially a settlement process by which an accused pays compounding charges in lieu of undergoing prosecution. Section 24 A reads as under: "Notwithstanding anything contained in the Code of Criminal Procedure Code, 1973 any offence punishable with imprisonment only, or with imprisonment and also with fine, may either before or after the institution of any proceeding, be compounded by a Securities Appellate Tribunal (SAP) or a court before which such proceedings are pending." Compounding Offence can cover appropriate prosecution cases filed by SEBI before the criminal courts. Prosecution means filing of criminal complaints before various criminal courts by SEBI for violation of provisions of securities laws which may be lead to imprisonment and/or fine. Compounding of offence can take place at any stage after filing criminal complaints by SEBI. Settlement of proceedings through compounding can be sought by any person who is notified that a proceeding may be instituted against him/her, or any party to a proceeding already instituted, may, at any time, propose in writing for settlement. Important Indicative Factors considered for the purpose of compounding of offences under the SEBI Act, 1992 are as follows – Whether violation is intentional Party's conduct Gravity of Charge History of non-compliance Good track record of the violator Whether there were circumstances beyond the control of the party Nature of violation i.e. technical / minor etc. Consideration of the amount of investors' harm or party's gain Processes which have been introduced since the violation to minimize future violations; Compliance schedule proposed by the violator Economic benefits accruing to a party from delayed or avoided compliance. Conditions where necessary to deter future non- compliance by the same or another party. Satisfaction of claim of investors regarding payment of money due to them or delivery of securities to them Compliance of the civil enforcement action by the accused Party has undergone any other regulatory enforcement action for the same violation; Any other factors necessary in the facts & circumstances of the case. Where compounding is proposed by a party, such application may be made to the court and a copy can be addressed to the "Division of Prosecution, Enforcement Department" at SEBI's Mumbai address. So far as process of compounding of offences is concerned, any party who wishes to compound an offence shall file an appropriate application before the court where complaint is pending with a copy addressed to the Prosecution Division, Enforcement Department of SEBI's Mumbai office which will forward the application to be placed before the High Powered Committee.