Sebi chief appointment under SC’s scrutiny | delhi | Hindustan Times
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Sebi chief appointment under SC’s scrutiny

delhi Updated: Sep 26, 2012 23:43 IST
HT Correspondent
HT Correspondent
Hindustan Times
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Supreme Court on Wednesday issued notices to the government and Omita Paul, secretary to the President, on a petition challenging the appointment of UK Sinha as the chairman of market regulator Sebi.

Alleging that the ex-UTI chief was not a man of “high integrity”, the petition, filed by Bangalore-based advocate Anil Kumar Agarwal, wanted the court to ask him under what authority of law he was holding office and why he should not be removed as Sebi chairman.

A bench of justices SS Nijjar and HL Gokhale, however, refused to seek a response from the government on the petitioner's second prayer to order a probe into the procedure adopted to appoint Sinha as Sebi chief.

Though Paul wasn’t initially a respondent, she was included after the court said it would not delve into allegations of bias against her unless she was made a party to the case.

Paul, as advisor to the finance minister, had allegedly changed the search-cum-selection committee in August 2010 to handpick Sinha as Sebi chairman even though he hadn’t applied for the post, the PIL stated.

Sinha’s name was cleared in February 2011 despite the previous search committee proposing a two-year extension to Sinha's predecessor CV Bhave.

The SC is already seized of another PIL challenging Sinha's appointment as Sebi chairman on the ground that the search committee constituted to select him was not in accordance with the rules, as it comprised nominees of the finance minister instead of Government of India.

Petitioner’s counsel Prashant Bhushan alleged Sinha’s integrity was under question since he had made a false declaration while seeking VRS from government service to take up a “commercial” assignment as chairman of UTI AMC, the company where he served as CMD for two-and-a-half-years on deputation from the finance ministry. Before deputation, as joint secretary with the ministry, Sinha oversaw UTI AMC and was also on its board of directors.

Post-retirement Sinha's position remained the same in the PSU but the character of his employment changed from a government servant on deputation to that of a retired bureaucrat on commercial assignment.

Within a month, the emoluments too increased from around R6 lakh per annum to R1 crore per annum. Later, these emoluments were enhanced to over R2 crore and then R4 crore, the petition claimed.