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Informist, Wednesday, Jun. 11, 2025

 

NEW DELHI - The Delhi High Court has dismissed Kairosoft AI Solutions Ltd.'s plea against surveillance actions taken by the BSE on the company's shares. The Delhi High Court said it was not the jurisdictional court to entertain Kairosoft AI's petition and granted liberty to the company to approach the appropriate court. 

 

The high court said that the "cause of action" against the petitioner arose only in Mumbai. "The facts pleaded by the petitioners to invoke the territorial jurisdiction of this court, as noted above, cannot be said to be essential, integral or material facts so as to constitute a part of 'cause of action' within the meaning of Article 226 (2) of the Constitution," said the high court. 

 

The petitioner had challenged BSE's action to put the shares of Kairosoft AI Solutions in graded surveillance measure stage IV on the basis of certain strangers uploading YouTube videos recommending the company's share scrips. Through this measure, the shares of the company can be traded only one day a week, which is every Monday, and a purchaser of a share has to deposit 100% amount over and above the share price as an additional surveillance deposit. Further, the petitioner had also contested BSE's general administrative circular issued in 2023, relating to shortlisting of share scrips for surveillance action.

 

In March, BSE had granted listing and trading approval to the company for listing of 782,956 equity shares. From Mar. 20 to Mar. 28, there was an upward price trend of the company's share scrip. 

 

According to the petitioner, after the upper trend became public news, a stranger on Mar. 29 made a YouTube video recommending the shares of Kairosoft AI. Thereafter, between Mar. 30 and Mar. 31, two research analysts namely Brahmi Kapasi, having 286,000 Instagram followers and Deepak Wadhwa having 700,000 YouTube subscribers, registered with SEBI, also made buy recommendations regarding the company's shares. Further, on Apr. 1 and and Apr. 2, two more videos from strangers emerged on YouTube on the same. 

 

Consequently, the BSE wrote to the petitioner and sought its comments. The petitioner responded by stating that the information circulated in the videos is inaccurate and has not been authorised by them. The petitioner said it was not aware of the content creators behind these videos and would file a complaint against the channels involved for disseminating inaccurate information. On Apr. 3 and Apr. 4, the BSE published notices on its website informing the general public that the company's securities have been shortlisted based on circulation of videos and unusual price movement and shall be treated under graded surveillance measure stage IV. The BSE requested the trading members to take precaution while trading in the petitioner's securities.  End

 

Reported by Surya Tripathi

Edited by Vandana Hingorani

 

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