IPO scam: SC gives Sebi two weeks to explain rejection of report

Expressing concerns over the capital market regulator’s outright rejection of a high-powered committee report probing IPO scam of 2006 and the role of NSDL in it,the Supreme Court on Monday asked Sebi to give its stand after two weeks. Besides,the bench comprising Justice R V Raveendran and Justice A K Patnaik said that the report submitted by the Committee,which comprised senior Securities and Exchange Board of India (Sebi) officials,should have been considered by the regulator. “Committee’s report should have been taken into consideration. Instead of taking action,you sidelined the report,” the bench said,adding “This is a committee of Sebi members only and not of outsiders. Why did they say that it is non-est(does not exist).” The apex court was also not convinced by submissions of the Attorney General Goolam E Vahanvati that the committee exceeded its limit. The bench shot back,“We would like to see. Show us a single order given by the committee in NSDL matter (where it) exceeded its jurisdiction. “Whatsoever they said (against Sebi) was self retrospection and this is not wrong. You could not have ignored,” the bench said. The Committee had also passed remarks against the manner in which Sebi had functioned in the IPO scam. Over the submissions of Attorney General that CB Bhave was no longer chairman of the Sebi,the bench said,“Even if Mr Bhave is not there,what so ever suggestion the committee has made,you (Sebi) should take a decision over it. Consider the suggestion and think about the market”. The apex court further said that at this stage it would not issue notice to any one and would like to await the view of the Sebi on this.