GENERAL23 Sept 2026
Merchant bankers must maintain 'Lakshman Rekha' with clients: SAT chief
Justice PS Dinesh Kumar, who heads the Securities Appellate Tribunal (SAT), has asked merchant bankers to keep a 'Lakshman Rekha' with clients. He means they should stay professionally distant, do proper due diligence, and give advice only within the law. This matters if you work with a merchant banker. Check that your adviser's work is clean and documented.
Key Statutory Highlights
- Justice PS Dinesh Kumar, Chief of the Securities Appellate Tribunal, said merchant bankers must keep professional distance from their clients.
- He said merchant bankers should do proper due diligence before advising clients.
- Merchant bankers should advise clients only within the framework of the law.
Actionable Advice for Taxpayers / Founders:If you appoint a merchant banker, ask for their due diligence notes and written advice, and make sure everything they tell you sits within the law. This is general guidance, not a legal opinion — check with your own adviser on your specific case.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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