Chennai:
Madras High Court has issued notice to the Union government after a
petition challenged the Securities Laws (Amendment) Ordinance granting
more powers to Securities Exchange Board of India (SEBI) as
unconstitutional.
The petition which was filed by Prashaanth Balasubramaniam before the
first bench comprising of acting chief justice Satish K Agnihotri and
Justice M M Sundresh questioned the ordinance which has been
promulgated thrice stating that as per Article 123 of constitution an
ordinance can only be promulgated twice.
The petitioner stated that as per the amendment, the nature of powers
given to SEBI are wide, far-reaching and require intense deliberation
and legislative reasoning. “The reasons for the ordinance may be sound
but repromulgation in such an important area of law which reflects the
nation’s reaction to Ponzi scheme must be legislated carefully and
thoroughly,” the petitioner said.
He said that section 11 (2) (ia) of SEBI Act has empowered SEBI to
call for information or records from any person including bank or
other authority or board or corporation he said the fact that these
powers are extended to any aircraft or vessel, including foreign, is
prima facie beyond the mandate of the legislation.
“The repromulgation in such sensitive areas of law has instant
ramifications and authorize an economic body with wide-ranging
investigative powers with regard to essentially sovereign functions. It is
constitutionally invalid,” he said.
Madras High Court has issued notice to the Union government after a
petition challenged the Securities Laws (Amendment) Ordinance granting
more powers to Securities Exchange Board of India (SEBI) as
unconstitutional.
The petition which was filed by Prashaanth Balasubramaniam before the
first bench comprising of acting chief justice Satish K Agnihotri and
Justice M M Sundresh questioned the ordinance which has been
promulgated thrice stating that as per Article 123 of constitution an
ordinance can only be promulgated twice.
The petitioner stated that as per the amendment, the nature of powers
given to SEBI are wide, far-reaching and require intense deliberation
and legislative reasoning. “The reasons for the ordinance may be sound
but repromulgation in such an important area of law which reflects the
nation’s reaction to Ponzi scheme must be legislated carefully and
thoroughly,” the petitioner said.
He said that section 11 (2) (ia) of SEBI Act has empowered SEBI to
call for information or records from any person including bank or
other authority or board or corporation he said the fact that these
powers are extended to any aircraft or vessel, including foreign, is
prima facie beyond the mandate of the legislation.
“The repromulgation in such sensitive areas of law has instant
ramifications and authorize an economic body with wide-ranging
investigative powers with regard to essentially sovereign functions. It is
constitutionally invalid,” he said.
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