SC upholds sanction against NSE’s Chitra Ramakrishna

The Supreme Court on Tuesday refused to interfere with the sanction granted for the prosecution of former National Stock Exchange (NSE) managing director and CEO Chitra Ramakrishna under the Prevention of Corruption Act in the NSE co-location case, while allowing her to raise before the trial court the question of whether she was performing a “public duty” and could be treated as a public servant

A bench of justices JB Pardiwala and K Vinod Chandran disposed of Ramakrishna’s challenge to a Delhi high court order upholding the sanction, saying the issue of whether she was performing a public duty could be raised during the trial.

The Delhi high court in July, held that the NSE performs a public duty because of its vital role in the economy and financial markets, and that Ramakrishna, by virtue of her position as its managing director and CEO, could not be completely separated from the functions discharged by the exchange.

The high court had accordingly rejected her plea to quash the sanction granted by the NSE board for her prosecution under the PC Act. It also held that whether Ramakrishna was actually in charge of the NSE’s day-to-day functioning and policy decisions, including the acts or contracts referred to in the charge sheet, were matters to be established through evidence at trial.

The Supreme Court’s order came in the case arising from the NSE co-location controversy, in which the Central Bureau of Investigation (CBI) has alleged that certain brokers were given preferential access to the exchange’s servers between 2010 and 2014.

According to the CBI chargesheet, Ramakrishna, while heading NSE, facilitated a system susceptible to manipulation that enabled certain brokers to obtain preferential access to the exchange’s servers. The agency has also alleged that she abused her position in appointing and fixing the remuneration of Anand Subramanian as chief strategic adviser to the managing director.

Ramakrishna had challenged the sanction on the ground that her duties were confined to managing NSE’s business and corporate governance and could not be elevated to the level of a public duty under the PC Act.

She had also argued that the sanction was invalid because the NSE board had itself maintained that neither the exchange nor its employees were “public servants” under the PC Act.

The plea further argued that the authority competent to remove Ramakrishna as managing director and CEO was NSE’s shareholders and not its board, making the sanction granted by the board legally unsustainable.

The Centre opposed the challenge, arguing that Ramakrishna occupied a position with a significant bearing on public interest and financial markets and that the functions performed by her consequently amounted to a public duty.

CBI, meanwhile, submitted that it was not necessary to determine whether NSE itself was a public authority. The relevant question, according to the agency, was whether Ramakrishna performed a “public duty” and consequently fell within the definition of a “public servant” under the PC Act.

The high court had also rejected Ramakrishna’s contention that the statutory definitions of “public servant” and “public duty” were vague and violated Articles 14 and 21 of the Constitution. It held that the inability to frame an exhaustive definition covering every possible situation did not make the provision vague or unconstitutional.

The co-location controversy surfaced in 2015 after a whistleblower alleged that some NSE members obtained early access to the exchange’s trading system because their servers were located on the exchange’s premises, allegedly with the involvement of certain exchange officials. The matter was subsequently probed by the Securities and Exchange Board of India, following which CBI registered a case in 2018.

The charge was that the co-location made it possible for some brokers to gain access to pricing information fractionally ahead of others, allowing them to front-run the markets.

CBI filed its chargesheet in 2022 against Ramakrishna and Subramanian under provisions of the PC Act and the Indian Penal Code. It alleged that Ramakrishna shared information about the switching-on time of NSE servers and facilitated access to the latest and least-crowded servers for certain brokers. It also accused her of arbitrarily appointing Subramanian and repeatedly increasing his remuneration without the approval of the NSE’s nomination and remuneration committee.

- Utkarsh Anand is the National Legal Editor at Hindustan Times, where he leads the newspaper's coverage of the Supreme Court, constitutional law, the judiciary and the Union law ministry. He joined Hindustan Times in 2020 after stints at Press Trust of India (PTI), The Indian Express and CNN-News18, and has over two decades of experience reporting on law, governance and public policy. His work has focussed on some of India's most consequential constitutional and legal developments, including the Supreme Court's judgments on Article 370, marriage equality, decriminalisation of homosexuality, the Babri Masjid dispute, electoral reforms and judicial appointments. He specialises in making complex legal proceedings and judgments accessible to readers while examining their wider social and political impact. Beyond daily reportage, Utkarsh has led investigative projects and enterprise reporting that have shaped public debate and prompted institutional responses. His work has received several journalism awards, including the Ramnath Goenka Excellence in Journalism Award. As National Legal Editor, he has also played a key role in expanding Hindustan Times' legal journalism footprint, mentoring reporters and strengthening coverage across platforms. A Chevening South Asia Journalism Programme Fellow, Utkarsh regularly writes analyses on the judiciary and constitutional issues, and his reporting is widely followed by lawyers, judges, policymakers, academics and readers seeking clarity on India's evolving legal landscape.Read More