Market regulator SEBI on Monday sought more time from the Supreme Court to give its views on the report of a high-powered committee that probed the IPO scam of 2006 and NSDL’s role in it.
Attorney General Goolam E. Vahanvati, appearing for the market regulator, informed the apex court that SEBI board is meeting tomorrow and sought more time to present its view on the report.
He further informed the court that the report on the IPO scam is on the agenda of the board meeting.
A bench comprising justices R.V. Raveendran and A.K. Patnaik adjourned the matter for two weeks.
Earlier on March 28, the court had asked SEBI to reply within four weeks whether it would revisit its decision to give a clean chit to NSDL (National Securities Depository Ltd) in the scam, which related to share allotment irregularities in various initial public offers (IPOs) between 2003 and 2006.
It had further asked SEBI “to consider whether its board will reconsider the special committee’s December 4 order in respect of NSDL and DSQ Securities and to pass an appropriate resolution and place it before this court.”
NSDL was given clean chit last year by SEBI when C.B. Bhave was its chairman. Mr. Bhave had recused himself from the SEBI board meeting in February 2010, when NSDL matter was discussed, as he had previously headed the depository.
The court had also pulled up the Attorney General for not taking any stand in this matter. It was not satisfied with his reply that the SEBI board has already taken a decision on the report of the committee, which had declared it as “non-est (does not exist).”
The Ministry of Finance had set up a committee consisting of two SEBI members G. Mohan Gopal, now Director of National Judicial Academy, and V. Leeladhar to look into the scam.
The Committee had passed three orders and found that NSDL had failed in its duty. It had also passed remarks against the manner in which SEBI had functioned in the IPO scam.
Earlier, the apex court had expressed concern over SEBI’s outright rejection of the report, and had asked the market regulator to give its stand.
It had remarked that as the Committee comprised of senior SEBI officials, the report should have been considered by the regulator.
The apex court was also not convinced by the submissions of SEBI that the committee exceeded its limit.
