“We have an open mind. We are disinvesting in Neyveli only for one reason, mainly to comply with the SEBI regulations. If there is another way to comply with SEBI regulation why should I shut my mind to that? Finance minister P Chidambaram said
The Centre will consider the Tamil Nadu government’s offer to buy 5% shares of the proposed disinvestment of public sector Neyveli Lignite Corporation (NLC) and sought to assuage employees’ concerns, saying there will be no change in management or staff policies.
“I have read about it (Tamil Nadu government’s offer) in the newspapers. I have not seen the letter (written by chief minister Jayalalithaa),” finance minister P Chidambaram said on Monday.
“The letter, I believe, is addressed to the prime minister. The copy of the letter has not come to me but assuming that is what the letter says, I will ask the Capital Markets division to quickly consult SEBI (Securities and Exchange Board of India) whether that would amount to compliance with the SEBI regulations,” he said.
“We have an open mind. We are disinvesting in Neyveli only for one reason, mainly to comply with the SEBI regulations. If there is another way to comply with SEBI regulation why should I shut my mind to that? I am willing to consider that option but I will have to consult SEBI,” Chidambaram said.
Asked about workers’ threat to go on strike against the disinvestment, Chidambaram said, “But why should they go on strike. There is a suggestion (of the Tamil Nadu government), we have not rejected it. We will consider it (and) if that’s a feasible suggestion we will accept it.”
“Be that as it may, what is the reason for a strike,” he asked.
“We are complying with the law. How can you say that the government should not comply with the law? Even after disinvestment, 89% of the shares of Neyveli Lignite will be held by the Government of India and the remaining bulk of it will be held by some public sector institutions—LIC, GIC, etc. So the character of NLC as public sector navratna does not change,” the finance minister said.
NLC is facing stiff protests over the disinvestment decision and 17 trade unions have already announced they would go on indefinite strike from the midnight of 3rd July till the decision of disinvestment is withdrawn.
SEBI had slapped a penalty of Rs2 lakh on Bengani after its probe had revealed that he along with some other entities had dealt in the scrip of T Spiritual World “in a fraudulent and manipulative manner” from 12 July 2004 to 4 February 2005
The Securities and Appellate Tribunal (SAT) has upheld the Securities and Exchange Board of India’s (SEBI) order against an individual related to fraudulent trading in T Spiritual World shares but has reduced the penalty imposed on him to Rs1 lakh from Rs2 lakh.
“We do not see any legal infirmity in the order passed by the respondent (SEBI) against the appellant (Vikas Ganeshmal Bengani) but keeping in view the totality of the facts and circumstances of the case and submissions made at the Bar, we reduce the penalty to Rs1 lakh while upholding rest of the order against the appellant,” SAT said in its order dated 26th June.
In September 2012, SEBI had slapped a penalty of Rs2 lakh on Bengani after its probe had revealed that he along with some other entities had dealt in the scrip of T Spiritual World “in a fraudulent and manipulative manner” from 12 July 2004 to 4 February 2005.
These trades had created false and misleading appearance of trading, artificial volume and price manipulation in the scrip facilitating the promoters to offload their stake.
Thereafter, Bengani had approached the SAT challenging SEBI’s order.
SAT noted that SEBI’s “adjudicating officer himself has not found two main charges against the appellant sustainable”.
“However, the appellant appears to be having some connection with some of the promoter group members and only for this the appellant has been held to be guilty of violating the law in this regard,” it added.
SEBI once again adopts an anti-investor attitude by flatly rejecting an RTI on the basis that it “would lead to diversion of the resources of the public authority”, which according to a former CIC, is absurd and untenable
Shailesh Gandhi, former Central Information Commissioner (CIC), is shocked to hear of Securities Exchange Board of India (SEBI) refusal to give information to Moneylife’s Right to Information (RTI) application. Mr Gandhi said, “The information sought which SEBI claims it is on its website, hence using Section 7(9) of RTI Act is absurd. Section 7(9) cannot be a ground for denial of information. SEBI PIO is completely wrong. It is unfortunate that the SEBI PIO is taking such an untenable position.” Moneylife had filed an RTI seeking information on portfolio management services (PMS), in electronic format. Rather than simply providing PMS information on a CD or pen drive, SEBI refused to give information by invoking Section 7(9) of the RTI Act and stated: “PMS Monthly report has already been uploaded on the SEBI website and is therefore in public domain. Collating the information and providing the same to you would lead to diversion of the resources of public authority.”
Section 7(9) of the RTI Act states: “An information shall ordinarily be provided in the form in which it is sought unless it would disproportionately divert the resources of the public authority or would be detrimental to the safety or preservation of the record in question.” Does this mean that merely giving information on a CD or a pen drive would “lead to diversion of the resources” or for that matter “be detrimental to the safety” of the records? If SEBI wants to maintain that the information sought is on their (extremely slow) website, what prevents them from providing the same upon inspection or even upon payment for CD?
Earlier, SEBI had uploaded information, on PMS companies, in a manner that was inaccessible and did not allow comparison of the performance of various schemes. This was also in response to a Moneylife RTI which we had fought hard for over a year. Not only is the site frustratingly slow, the information is not downloadable. At this rate, it is simply not feasible for a common investor to compare 250 PMS companies within an hour let alone a single day. It will take the average investor weeks to collect ‘incomplete’ information of just 100 PMS companies. It is pertinent to note that SEBI has not uploaded long-term performances of PMS companies on their website, and therefore information is ‘incomplete’. For more details on this, you can access our full exclusive story here: SEBI’s system of reporting PMS data continues to be frustratingly anti-investor. This prompted us to visit SEBI’s premises and seek for entire PMS information in electronic format (i.e. CD or pen drive).
Moneylife team visited the premises of SEBI to seek information of PMS companies in electronic format. Upon visiting the premises we did not meet the public information officer (PIO). Instead, the Assistant General Manager, SEBI, Aman Jain, met us but had little or no clue about Section 4. He didn’t know if SEBI had the information on PMS companies in electronic format. He asked us to file a fresh RTI, under Section 6, which we did.
SEBI not only did not entertain an onsite inspection of records (i.e. Section 4), it also stonewalled our fresh RTI application (Section 6) in which SEBI has shockingly refused to give information in CD format, citing that the information sought after was very “vague and not specific”! (In our RTI application, we were very specific and even cited the link where information was kept—http://www.sebi.gov.in/sebiweb/investment/PMRReport.jsp). They went on invoke Section 7(9) of the RTI Act.
Nagesh Kini, a prominent social activist, says, “This is total contradictory to the way BrihanMumbai Municipal Corporation (BMC) functions, which is friendly when it comes to providing information. They even entertain the public under Section 4 of the RTI Act. They provide you a room, table and all the material and files, allow you to mark the documents you want copied and even provide you with the Xerox facility.” According to a recent news report, the BMC fields the largest number of RTIs in the state, with nearly 1.02 lakh applications, or 16% of the total RTIs filed in Maharashtra.
Section 4 of the RTI Act, and its sub-sections, clearly state that information should be easily accessible and should be even provided in the format or medium it has been sought.
Section 4(4) states: “All materials shall be disseminated taking into consideration the cost effectiveness, local language and the most effective method of communication in that local area and the information should be easily accessible, to the extent possible in electronic format with the Central Public Information Officer or State Public Information Officer, as the case may be, available free or at such cost of the medium or the print cost price as may be prescribed.” (emphasis ours)
Section 4(3) states: "For the purposes of sub-section (1), every information shall be disseminated widely and in such form and manner which is easily accessible to the public."
Explanation.—For the purposes of sub-sections (3) and (4), ‘disseminated’ means making known or communicated the information to the public through notice boards, newspapers, public announcements, media broadcasts, the internet or any other means, including inspection of offices of any public authority.”(emphasis ours)
Section 4(1) of the RTI Act, 2005 states: “Every public authority shall maintain all its records duly catalogued and indexed in a manner and the form which facilitates the right to information under this Act and ensure that all records that are appropriate to be computerised are, within a reasonable time and subject to availability of resources, computerised and connected through a network all over the country on different systems so that access to such records is facilitated.”
Furthermore, Section 4(2) states: “It shall be a constant endeavour of every public authority to take steps in accordance with the requirements of clause (b) of sub-section (1) to provide as much information suo motu to the public at regular intervals through various means of communications, including internet, so that the public have minimum resort to the use of this Act to obtain information.”
The fact that SEBI refused to provide information under both Section 4 and Section 6 shows the callous attitude of the market regulator towards consumers and Indian citizens. In the meantime, investors will need to spend over one week just to obtain (incomplete) information on PMS companies on SEBI’s excruciatingly slow website.
Moneylife plans to file a first appeal.