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JPC takes critical view of SEBI's regulatory role

Jayanta Mallick

KOLKATA, July 11

THE Joint Parliamentary Committee (JPC), investigating the stock market scam, appears to have taken a critical view of the Securities and Exchange Board of India's regulatory role in the capital market.

According to JPC sources, after the first round of depositions in the technical sessions during 25 sittings, the panel has received overwhelmingly negative depositions against SEBI.

Some of the JPC members are intrigued by certain omissions in the preliminary report of SEBI. Absence of information on the role of Mr Anand Rathi, former BSE President, and selection of only four momentum scrips -- Zee Telefilms, Himachal Futuristic, Gl obal Tele and DSQ Software -- detailing UTI's buy/sale figures from July 1999 to March 2001 is being seen as a little incongruous.

``One of (the) stocks, which frequently topped the UTI's buy/sale list in the last five years and was favoured by Ketan Parekh too, could have figured in SEBI's report,'' a JPC source told Business Line.

Mr P.M. Tripathi, JPC Chairman, however, pointed out that SEBI's preliminary report on the scam, which was made available to the JPC by the Union Government, was just one of the many ``valuable'' inputs.

The final report from SEBI, if it is submitted during the tenure of the JPC, will obviously be ``used,'' Mr Tripathi pointed out. ``We will soon start collating information provided by all agencies (including SEBI) in their written replies to the queries from JPC.''

In the preliminary report, SEBI has accepted, to a great extent, that there were regulatory failures but stopped short of fixing responsibility, some of the JPC members felt.

Individual memoranda/written submissions in response to notice put out by the JPC has also been encouraging so far. ``We are still open to such memoranda, provided the person concerned owns up to whatever is submitted,'' said Mr Nilotpal Basu.

Mr Tripathi indicated that the JPC was proceeding without any preconceived notion. The JPC is working on the principle of unanimity among the 30 members representing both Houses of Parliament in terms of procedural matters and opinion-formation, the pane l sources said.