Regulatory fee or unjust enrichment?

Regulators are empowered to levy fees for services rendered, not to impose tax-like levies to create surpluses for themselves

In an exchange filing recently, BSE stated that the Securities and Exchange Board of India (Sebi) has asked it to pay the regulatory fee on the annual turnover, considering the “notional value” in the case of options contracts. The communication from Sebi further advised BSE to pay this amount retrospectively, i.e., from the financial year (FY) 2006-07, with 15 per cent interest per annum. The amount is expected to be close to Rs 70 crore. Financial and fiscal experts find this odd and wrong.

How does a regulator get resourced? One of the reasons why we have regulators is the desire