No move to trim Sebi’s search powers: MoF

NEW DELHI: The finance ministry said there is no move to drop the proposal to arm the SEBI with powers to carry out search and seizures on erring companies in a bid to prevent scams.
“The search and seizure powers have not been dropped totally from the proposed bill to amend Sebi Act. The bill is likely to be introduced in the monsoon session of Parliament,� finance minister Yashwant Sinha said.
Sinha’s assertion assumes significance in the wake of reports that law ministry was not in favour of Sebi being provided with powers to carry out search and seizures as was given to Enforcement Directorate and Central Bureau for Investigation.
The law ministry is of the view that such sweeping powers would go against the interest of corporates. Besides, the department of company affairs is also empowered to inspect account books and initiate proceedings against erring corporates under the Companies Act.
But finance ministry felt Sebi, which is a quasi judicial body, should be provided with these powers to give more teeth to the market regulator. At present, Sebi’s hands are tied while dealing with scams in capital markets because of the lack of such provisions. Sebi also wanted it to be empowered to impose penalties.