Securities and Exchange Board of India (SEBI) chairperson Madhabi Puri Buch, who had been summoned by Parliament’s Public Accounts Committee (PAC) as part of its review of financial regulators, skipped its meeting on Thursday, citing personal reasons.
PAC chairman and Congress leader K.C. Venugopal adjourned the meeting after reading out a letter from Ms. Buch, conveying her inability to appear before the committee. Ms. Buch has been in the eye of a storm over allegations of financial irregularities.
At that point, MPs from the ruling Bharatiya Janata Party protested, arguing that it was beyond the PAC’s mandate to summon the SEBI chief. Ignoring their protests, Mr. Venugopal adjourned the meeting
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Last-minute communication
Speaking to reporters after the adjournment, Mr. Venugopal said, “Today morning at 9:30, we got a communication from the SEBI chairperson and other members that because of a personal exigency, she is unable to travel to Delhi.” He noted that skipping the meeting could be considered as “contempt” of legislative bodies, but said that as she was “a lady”, the committee had allowed her to miss the meeting.
Parliament’s Public Accounts Committee (PAC) chairperson K.C. Venugopal interacts with the media after the committee’s meeting was postponed, in New Delhi, on October 24, 2024. | Photo Credit: PTI
According to sources, the PAC sent a letter 20 days ago, inviting Ms. Buch to attend the meeting. It is learnt that SEBI confirmed to the PAC office that four people would come for the meeting, including Ms. Buch. However, sources say that Ms. Buch later sought an exemption from deposing before the committee, saying that the recent allegations made by U.S.-based Hindenburg Research against SEBI were sub judice. Mr. Venugopal rejected her contention, sources said, explaining that the agenda for the meeting was a “performance review”. Her letter conveying her inability to attend Thursday’s meeting on landed at 9:30 a.m.
‘Suo moto summons’
Though Mr. Venugopal and other Opposition members left the meeting hall after adjournment, the ruling party’s members continued sitting there for nearly 25 minutes, after which they left to meet Lok Sabha Speaker Om Birla.
“Your [Mr. Venugopal’s] own words are ‘suo motu’. How did you decide? The PAC’s job is to consider [Comptroller and Auditor General of India] CAG reports. We have this information from reliable sources that the CAG has made no mention of SEBI. This entire conduct is unparliamentary. The conduct of chairperson, in the way he adjourned, did not allow us to speak. And [he] walked out, [which] shows he has extraneous political considerations,” said BJP MP and former Union Minister Ravi Shankar Prasad.
BJP leader Ravi Shankar Prasad and others interact with the media after Parliament’s Public Accounts Committee’s (PAC) meeting was postponed, in New Delhi, on October 24, 2024. | Photo Credit: PTI
Review of regulators
When the PAC reconvened in the afternoon, it was slated to deliberate on the working of the Telecom Regulatory Authority of India (TRAI). However, the war of words continued on the selection of the day’s agenda: a “performance review of regulatory bodies established by Act of Parliament”.
The ruling party members, according to sources, demanded that the choice of subject should also be put to a vote. BJP MPs accused Mr. Venugopal of picking it suo moto without consulting others. Mr. Venugopal, it is learnt, did not allow a vote, arguing that the subject had been duly circulated to the members and notified, and had not invited any protest. It cannot be retrospectively put to a vote, he said. He also informed the members that a past PAC, then headed by BJP leader Murli Manohar Joshi, had also summoned SEBI and submitted a report on it.
According to sources, Mr. Venugopal also disputed the allegation that he had unilaterally selected the subject, noting that in the PAC’s very first meeting, Trinamool Congress MP Saugata Roy and Congress MP Amar Singh had both raised the issue of deliberating on regulatory bodies as well. He also said that he had consulted the CAG himself, who did not object to the subject choice, sources said.
Hindenburg’s allegations
The BJP members contended that summoning the SEBI chief is a political tactic since it is an issue that the Congress has been continuously flogging within Parliament and outside. In January 2023, U.S.-based Hindenburg Research had alleged that the Adani group had indulged in “stock price manipulation”. On March 2, 2023, the Supreme Court asked SEBI to complete its probe into the allegations made in Hindenburg’s report within two months, to determine whether any stock price manipulation or other financial irregularities had taken place.
On August 10 this year, Hindenburg Research released another report, alleging that the SEBI chairperson, Ms. Buch, held a stake in obscure offshore entities which were used in what it claimed was the Adani money syphoning scandal.
‘SEBI chief’s reluctance’
Later in the evening, Congress leader Rahul Gandhi, the Leader of the Opposition in the Lok Sabha, raised questions about Ms. Buch’s “reluctance” to appear before the committee. “Why is Madhabi Buch reluctant to answer questions before the Public Accounts Committee (PAC) of Parliament?” he asked in a post on X a few hours after the meeting. “Who is behind the plan to protect her from being answerable to the PAC?” he added.
Congress president Mallikarjun Kharge also stepped into the debate, arguing that the PAC has the constitutional right to summon any officer in connection with any government investigation. “To safeguard the autonomy of SEBI, to maintain the impartiality of the institution and to ensure accountability to Parliament, the SEBI chairperson will have to answer before the PAC. Modi government cannot hide its misdeeds by using SEBI chairperson as shield,” Mr. Kharge posted on X.
‘Political motivations’
Earlier, BJP MP and PAC member Nishikant Dubey wrote to Mr. Birla, accusing Mr. Venugopal of raking up “non-existent” issues to defame the Union government and “destabilise” the country’s financial structure and economy. Accusing him of “unconstitutional and disdainful” conduct, Mr. Dubey claimed that the Congress leader’s conduct was guided by political motivations as the voters had compelled his party to sit in the Opposition benches following the Lok Sabha election.
Claiming that unverified allegations by a foreign company like Hindenburg against Ms. Buch were part of such a campaign, he said that the “India chapter” of this “toolkit” has become active.
Published - October 24, 2024 12:03 pm IST
