New Delhi, Aug. 4: A new bill was introduced in the Lok Sabha today to empower Sebi to take on fraudsters and other defaulters. In the new bill, the government has tweaked certain powers relating to search and seizures earlier granted through ordinances.
Sebi will have to seek permission from special courts to conduct search and seizure operations, while some new provisions have been introduced to provide for minimum penalties ranging from Rs 1 lakh to Rs 10 lakh.
The new bill, called the Securities Laws (Amendment) Bill, 2014, has 57 clauses to amend various provisions of the three capital market-related acts against 30 clauses in the ordinance passed in March.
While the new bill has retained all the powers granted to Sebi through the three ordinances, it has tweaked some provisions as there were demands that greater powers need to be balanced with safeguards.
The ordinance allowed the Sebi chief to authorise search and seizures against suspected entities, but the new bill provides that a permission is necessary from a magistrate or judge of a designated court.
The bill retains many powers given to Sebi through ordinances, including those giving it authority to act against illegal money-pooling schemes involving Rs 100 crore or more, launch recovery proceedings, attach and sell defaulters’ properties and assets, and seek call data records and other information from any person, company, bank, authority or organisation.
The provisions giving Sebi powers to enhance a penalty or settle ongoing proceedings have also been retained, while the new bill provides for setting up of special Sebi courts to expedite the cases.
The provisions giving Sebi powers to enhance a penalty or settle ongoing proceedings have been retained as well.