The Bombay High Court on Tuesday stayed a Mumbai court’s order directing the registration of a first information report against former Securities and Exchange Board of India chairperson Madhabi Puri Buch and five others over alleged stock market fraud and regulatory violations, Live Law reported.

Buch and the others had challenged the order in the High Court, seeking that the case be quashed.

Justice Shivkumar Dige said the special Anti-Corruption Bureau court had passed the order “mechanically” without examining details or giving the officials a chance to respond.

The special Anti-Corruption Bureau court’s directions on Saturday came on a complaint by Sapan Shrivastava, a Dombivli resident, who claimed that he and his family had invested in shares of a company called Cals Refineries Limited on December 13, 1994, which was listed on the BSE.

Shrivastava said he had suffered huge losses, adding that SEBI and BSE failed to protect the interests of investors by neglecting the firm’s crimes and listing it against the law. He said he was forced to approach the court as the police and regulatory bodies had not acted on his complaint.

The complaint claimed that officials at the market regulator had allowed the listing of the company even though it did not meet prescribed norms, thereby facilitating market manipulation and corporate fraud.

The special court judge Shashikant Bangar was quoted as having observed that there was “prima facie evidence of regulatory lapses and collusion, requiring a fair and impartial probe”.

Besides Buch, three whole-time members of SEBI – Ashwani Bhatia, Anant Narayan G and Kamlesh Varshney – and BSE Chairman Pramod Agarwal and Chief Executive Officer Sundararaman Ramamurthy were named in the complaint.

The special court judge said that the “inaction” of SEBI officials and law enforcement agencies should be investigated.

The Anti-Corruption Bureau was directed to register an FIR under the Prevention of Corruption Act, the Securities and Exchange Board of India Act and the Indian Penal Code. The bureau was to submit a status report within a month.