SEBI defends Mehta’s tenure

New Delhi, April 20: The Securities and exchange board of India (SEBI) today told Delhi high court that public interest petition challenging...

New Delhi, April 20: The Securities and exchange board of India (SEBI) today told Delhi high court that public interest petition challenging continuance of its Chairman D R Mehta beyond February 20, 1998 should be dismissed on grounds of delay.

In its reply to the PIL filed by Arun Agrawal, SEBI contended that the appointment of Mehta was made on February 21, 1995 and the petitioner sought to challenge it after three years.

Agrawal through his counsel Prashant Bhushan had challenged Mehta’s continuance beyond February 20, 1998 saying that the SEBI chief can be appointed only for three years.

Mehta completed three years on February 20, 1998.

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The Finance Ministry, in its reply, said the government was empowered to relax provisions on any of the rules with respect to any class or category of persons under Rule 20 of the SEBI Act, 1992 though the chairman was normally appointed for three years under Rule 3 of the Act.

Mehta’s appointment for five year term was considered and approved by the appointmentscommittee of the cabinet and the then Finance Minister and it cannot be challenged, the ministry contended.

The ministry said Mehta had also indicated that he would be willing to take SEBI chairmanship if he was given a five year term. A division bench comprising Justice Mahender Narain and Justice S K Mahajan posted the case for further hearing on April 29.

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