SEBI did not water down the NSE orders, acted as ordered: Tyagi

FM had recently said govt. analyzed whether “necessary punitive measures” were taken in the NSE case

FM had recently said govt. analyzed whether “necessary punitive measures” were taken in the NSE case

Days after the government publicly announced its intention to consider an SEBI order in the NSE matter, its outgoing chairman Ajay Tyagi made it clear on Wednesday that the market regulator had not “watered down” any of the quasi-court rulings.

The comments gain relevance as Finance Minister Nirmala Sitharaman reportedly recently said the government is considering whether Sebi has taken “necessary punitive action” in the case.

In a media interview, the FM said the government was examining whether there had been “sufficient common sense in dealing with this matter” and whether the SEBI had taken appropriate corrective action after using its common sense.

Mr Tyagi said on Wednesday SEBI acted in accordance with its mandate and understanding on the matter, starting with the main case of co-housing allegations and also the recent order finding former NSE chief Chitra Ramkrishna shared with a mystic and consulted with him figure in the Himalayas to operate the largest stock exchange, Tyagi said.

Speaking to reporters after handing over responsibility to his successor Madhabi Puri Buch after five years at the helm, Mr Tyagi said the NSE matter covered the period 2010-15 and SEBI had its first order in April 2019 enacted in the co-location matter.

He admitted that there had been a delay in ordering the second case involving Ms Ramkrishna’s work, suggesting the delay was due to the COVID-19 pandemic. However, the delay was not intentional, he clarified.

“We came out with orders within our purview and understanding,” he said, stressing that no one could say the regulator “watered down” the orders. He was responding to an inquiry that wanted to know if SEBI had issued loose orders on the matter.

Mr Tyagi said SEBI’s work is transparent as the orders are communicated to the wider public on the day they are made, stressing that the orders are quasi-judicial in nature and can be challenged before tribunals and courts.

He pointed out that anything that is publicly available about the wrongdoings of the NSE and its then-boss Ms. Ramkrishna are courtesy orders from SEBI, adding that there are other law enforcement agencies also investigating the matter.

“We should also expect more clarity from their findings,” Mr Tyagi said.

He added that SEBI is sharing its findings with other authorities as requested. Following SEBI’s most recent directive, the Central Bureau of Investigation and the Income Tax Division had reopened their investigations into the cases against the NSE, and there were also some arrests.

Asked about the days of SEBI’s descent before its departure from the decision to separate the posts of chairman and chief executive officer on a voluntary basis, Mr Tyagi said nearly half of the top 500 companies are still non-compliant even after four years were the original guidelines that led to the decision.

Mr. Tyagi acknowledged that there was lobbying from groups such as the Confederation of Indian Industry (CII) and the Federation of Indian Chambers of Commerce & Industry (FICCI) and hoped the companies’ shareholders would follow this in the best interest of the company’s management .

He also said that the statutes for state-owned and private companies should not be different, adding that all listed companies should be subject to the provisions of the Companies Act alone and not other exclusive laws.

He highlighted the deepening of the retail investor game in the capital markets as one of his greatest achievements, noting that 2.2 million individuals had opened Demat accounts in the last two years alone.

SEBI has been in touch with the government on cryptocurrency regulations since November 2021, he said, adding that the exchange of drafts and views has taken place.

Mr Tyagi said SEBI has an internal group dedicated to the emerging asset class.

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