Atr Inaction: Sebi Unaware Of Cell To Probe 1992 Scam

The Securities and Exchange Board of India has denied any information of a committee constituted in 1994 by the government to probe the nexus between corporate houses and share broking outfits.

The committee was set up in line with the recommendations of the action taken report (ATR) of the 1992 joint parliamentary committee (JPC) on stock scam.

The special cell was set up under the Central Board of Direct Taxes to examine the role of corporates with respect to the scam and the close nexus between prominent industrial houses, banks and brokers.

The cell was to have officials from the Department of Company Affairs, Central Bureau of Investigation, Reserve Bank of India besides Sebi.

 

Demonstrating the casualness with which the government went about its probe, the cell had only five sittings between June 28 ,1994 and May 25, 1995.

And though the government had promised in its first ATR that the market watchdog will be part of the cell, Sebi chairman D R Mehta in his deposition before the current JPC recently expresed surprise about the exisitence of such a cell.

The 1992 JPC had come across various instances of close nexus between prominent industrial houses, banks and brokers. In its report to the present JPC, the mininisty of finance says the