New Delhi, Feb. 11 -- The Supreme Court on Tuesday ruled that a husband can be held jointly and severally liable for the debit balance in his wife's stock trading account based on an oral agreement and the nature of their financial dealings.
A bench comprising Justice PS Narasimha and Justice Sandeep Mehta held that an arbitral tribunal can exercise jurisdiction over the husband in such cases under Bye-law 248(a) of the Bombay Stock Exchange (BSE) Byelaws,1957.
"Under Bye-law 248(a) (BSE), the arbitral tribunal could have exercised jurisdiction over respondent no. 1 (husband) based on an oral contract that he would be jointly and severally liable for the transactions undertaken in respondent no. 2's (wife) account. Such oral contract woul...