As for the committee’s remarks about separating the quasi-judicial and executive arms of SEBI, the regulator responds by stating the internal procedures that the Regulator follows. However, it is public knowledge that the Whole Time Members of SEBI perform the duties of members of the Board as well as adjudicators. Also, the SEBI Act allows any person appointed by the Board to become an Investigating Officer. Any SEBI personnel not below the rank of Division Chief can be the Adjudicating Officer for offenses meriting a penalty under the SEBI Act 1992.

SEBI officials also have a wide discretionary range of penalties they can impose in their quasi-judicial capacity.

With Great Power Comes Great Irresponsibility?

On May 12, 2023, SEBI had sought six months’ time from the Supreme Court to complete its probe on the alleged violations by the Adani Group but the Apex Court ordered the Regulator to complete its investigations before August 14, 2023. Rather than focusing on the investigations it seems that SEBI is preparing excuses for delay in investigations by countering the recommendations of the Expert Committee.

On one hand, the Application by SEBI tries to impress upon the Court that all its procedures and internal regulations are sound and immaculate, and on the other hand the Regulator is citing multiple difficulties in adhering to timelines as an investigator.

Refuting the committee’s claims about SEBI not finding any irregularities with Adani Group’s security transactions, the application also impresses the reader with the proposed ways in which SEBI may prove the alleged irregularities.

However, it remains to be seen when the regulator may do so. Time is of the essence for SEBI which was created to maintain the integrity of the securities market because whether it is the Adani Group or the common investors, every party deserves closure. While violators should face the wrath of the law speedily, the innocent do not deserve to be under suspicion of guilt for ages. After all, justice delayed will be justice denied.

Expert Committee Report

How stock markets regulator SEBI dislikes being regulated