Complaints on Sahara, SEBI top grievances to government

Complaints on Sahara, SEBI top grievances to government

Of the total grievances, the highest number of 18,567 grievances were related to the Information and Broadcasting ministry

Sahara, SEBI, SEBI Grievances, Sahara, NSEL scam, Commodity Transaction Tax, CTT, India News, Indian Express, Indian Express News
Of the total grievances, the highest number of 18,567 grievances were related to the Information and Broadcasting ministry (File)

Unfair judgement awards by stock exchanges and market regulator SEBI and no refunds from scam cases like Sahara top the list of complaints received by the Centre, a government instituted study has said. The pan-ministry study found that the bulk of the grievances related to the Department of Economic Affairs were on the National Spot Exchange Ltd (NSEL) scam and significant losses due to the levy of Commodity Transaction Tax (CTT).

The study was conducted by the Quality Council of India for the Ministry of Personnel, Public Grievances and Pensions, following recommendations of a Parliamentary committee. It involved identification of top grievance categories and recommendation of systemic reforms.

“For the Department of Economic Affairs, the top most issue for the ministry revolved around investor woes concerned with Securities and Exchange Board of India (SEBI), Commodity Markets issue, refund of scams and employee grievances, accounting for 25 per cent, 18 per cent,17 per cent and 8 per cent of the grievances,” said the study, presented recently to Minister of State for Personnel Jitendra Singh. The study also cited “non-receipt of shares, dividend pay-outs or bonus shares”, “unfair judgement awards by the stock exchanges and SEBI”, “unauthorised and unlawful transaction by the brokers as trading members” and “unsatisfactory grievance redressal” as issues causing grievances with the market regulator.

“No refund has been received in scam cases like Sahara Ltd,” the report said, highlighting “refunds of scams” as a major grievance causing issue. The Department of Economic Affairs received 9,553 complaints from April 1, 2012 to March 31, 2016. The study focused on the period from April 1, 2015 to March 31, 2016, when 2,076 complaints were received. For its analysis, it used a sample size of 250 cases.


The Sahara case deals with alleged irregularities in raising over Rs 24,000 crore from more than three crore investors. The NSEL — which is now defunct — suspended trading on July 31, 2013 after a major payment crisis broke out at the bourse. Subsequently, a number of regulators and enforcement agencies launched probes into the NSEL matter.

The CTT is levied on transactions done on the domestic commodity derivatives exchange. The study also suggested certain priority systemic reforms to check grievances.

“With regards to grievance category non-refund scams like Sahara, was deprioritized for the reform recommendation exercise, as most of these cases are sub-judice,” it said. According to the report, SEBI has taken several steps to address investor grievances relating to dividends.

It has made it mandatory for the top 500 listed companies (in terms of market capitalisation) to have a dividend distribution policy which will broadly list the circumstances and financial parameters (internal and external) under which a shareholder may or may not expect a dividend. “This policy will need to be disclosed in the annual reports and websites,” it said.

The report suggested that transaction taxes across products be looked at in order to increase trading volumes in market. It also suggested provision for placement of a link directing users to grievance lodging portals like SEBI Complaint Redress System (SCORES) within Demat dashboard websites.

A total of 20 ministries/departments were selected for the study based on the number of grievances received by them from April 2012 to March 2016 through the Centralised Public Grievance Redress and Monitoring System (CPGRAMS) — an online system for filing of complaints.

Of the total grievances, the highest number of 18,567 grievances were related to the Information and Broadcasting ministry. Besides, 17,840 grievances were related to the Department of Financial Services (Insurance Division), 17,323 against the Ministry of Environment, Forest and Climate Change, 17,084 against the Ministry of Corporate Affairs and 16,047 against Consumer Affairs Ministry, the study said.