๐๐ง๐๐ข๐’๐ฌ ๐๐๐๐ฎ๐ซ๐ข๐ญ๐ข๐๐ฌ ๐๐๐ซ๐ค๐๐ญ๐ฌ ๐๐จ๐๐: ๐๐๐ฐ๐ฆ๐๐ค๐๐ซ๐ฌ ๐ฆ๐ฎ๐ฌ๐ญ ๐ฉ๐ฎ๐ญ ๐๐๐๐ข’๐ฌ ๐ซ๐๐ฏ๐ข๐ฌ๐ข๐จ๐ง๐๐ซ๐ฒ ๐๐ฎ๐ญ๐ก๐จ๐ซ๐ข๐ญ๐ฒ ๐ญ๐จ ๐ฌ๐๐ซ๐ฎ๐ญ๐ข๐ง๐ฒ
Sumit Agrawal (Managing Partner, Regstreet Law Advisors, and former Securities and Exchange Board of India (SEBI) officer) and Dr. M. S. Sahoo (Former Chairperson, Insolvency & Bankruptcy Board of India (IBBI) and former Whole-time Member, SEBI) have written an opinion piece in Mint, making the case that SEBI’s revisionary power under Clause 21 of the Securities Markets Code Bill, 2025 (Code) must be put to scrutiny, and that the regulator should not be placed in a position to judge its own order.
Clause 21 carries over and expands SEBI’s power under the SEBI Act. While the earlier provision allowed SEBI to revise only the quantum of a monetary penalty, Clause 21 permits it to call for the record of an adjudicating officer’s (AO) order and enhance the penalty or severity of any direction, with no equivalent power to reduce or modify it. The authors point out that of the 25 reported revision orders passed since 2014, 13 converted an AO’s exoneration into a fresh penalty, and none reduced what the AO had decided.
Their proposed fix: remove SEBI from the revisionary chair altogether and give it a statutory right, like any aggrieved party, to take an AO’s order it considers too lenient to the Securities Appellate Tribunal (SAT), so that one independent tribunal decides whether an order was too lenient or too harsh.
A timely and important read on enforcement design under the Securities Markets Code.
Full article is available at https://lnkd.in/gZV_fWF3
