Lately, Securities and Exchange Board of India (Sebi) has been facing criticism for its ‘unsatisfactory’ record on recovering dues emanating from its quasi-judicial-orders-backed recovery notices. Sebi has now decided to come clean on this issue. Its Annual Report 2021-22 explicitly states that Rs 67,228 crore of dues—out of Rs 96,609 crore, or about 70%—is ‘difficult to recover’ (DTR). Transparency is the best antidote for any problem lingering in the shadows. Sebi deserves to be complimented for taking this charging bull by its horns.
Nobody kicks a dead dog! While this adage may be applied to many agencies, financial regulatory authorities are rarely amongst them. They are subject to constant, substantial public scrutiny, which gets magnified during times of crises.
Sebi has been globally recognised as a successful securities market regulator. Empowered with substantial statutory powers, it has achieved many milestones in pursuing a proactive approach to conduct regulation of the entities under its purview. It brings out regulations following due process and passes quasi-judicial orders in accordance with law. Its regulations have withstood time with hardly any legal challenge. Many of its landmark quasi-judicial orders have been upheld by the Supreme Court, and became instrumental in many legislative/regulatory changes.
However, despite such success in its core tasks, Sebi’s DTR dues indicate that something is seriously wrong somewhere.
The…
