CBI director says it is too early for closure of Bhave case

Under pressure from various quarters for registering a preliminary inquiry against former Securities & Exchange Board of India (Sebi) chairman C B Bhave, the Central Bureau of Investigation (CBI) has now sought documents pertaining to the recognition given to MCX-SX in 2008.

Speaking to Business Standard, CBI Director Ranjit Sinha said, "It is too early to think of closure in this matter." Sources, however, didn't rule out the possibility of the case being closed if no evidence was found against Bhave.

On March 13, the CBI had registered a preliminary inquiry against Bhave, drawing criticism from Union ministers P Chidambaram and Jairam Ramesh. HDFC Chairman Deepak Parekh was also critical of the investigative agency, saying it was "creating fear psychosis for public officers". A CBI probe against such "upright" public officers would further vitiate the decision-making environment in the country, he added.

Bhave has reportedly said if the CBI fails to come up with evidence against him, it should tender an apology.

Besides Bhave, the CBI is also probing the role of former Sebi member K M Abraham for his role in alleged irregularities in granting a sanction to MCX's equity bourse. The CBI has taken note of the fact that Abraham had raised the issue of "financial jugglery" by MCX in its stake dilution in 2010. It is probing why this issue wasn't issue was raised between 2008 and 2010, the period the CBI is probing.

The agency says within a year of MCX-SX being granted a licence, MCX was to dilute its stake in the stock exchange from 91 per cent to five per cent. Despite failure to meet this requirement, the licence was renewed in 2009. This aspect is also being probed by the CBI.

After collecting enough information, the agency will approach Bhave for "his side of the story".