THE Securities Laws (Amendment) Bill, 2013, got promulgated as an ordinance for the third time on Thursday by President Pranab Mukherjee.
The ordinance gives the Securities and Exchange Board of India (Sebi) powers to go through call records, conduct search and seizure, attach bank accounts and property and even arrest a person for failing to comply with its orders.
It had been learnt that that Prime Minister Manmohan Singh and the finance minister P Chidambaram had urged for the need for the ordinance and to be passed and the issue was finally taken in the Cabinet meeting today.
While the government had been delaying the promulgation to build up a consensus within the Cabinet because Mukherjee had apparently informed them about his displeasure on using the ordinance route to get around stalled legislations, The Indian Express had on Wednesday reported that the President had agreed to clear the ordinance to give powers to Sebi.
The Sebi ordinance has been promulgated twice since it was first issued on July 17, 2013. It was extended for the second time in September 2013. But the ordinance lapsed on January 15 and has not been promulgated since then. The ordinance in place gives the right to Sebi to go after companies like Sahara which run collective investment schemes without the regulator’s approval.
In the Winter Session of Parliament, the Bill could not be taken up as the standing committee on finance had not finalised its report. The ordinance will need to be replaced by a new Bill in the new Lok Sabha as the former will stand lapsed.
While the Bill will replace the ordinance, it will amend the Securities and Exchange Board of India Act, 1992, the Securities Contracts (Regulation) Act, 1956 and the Depositories Act, 1996.
A source close to the standing committee had told The Indian Express that there was opposition from even among the members about whether the Sebi should be given such extended powers like asking for telephone call records and powers to conduct searches.