New Delhi: The Supreme Court on Thursday refused to issue any direction to the Securities and Exchange Board of India (SEBI) mandating public disclosure of ultimate beneficial owners and portfolios of Alternative Investment Funds (AIFs), Foreign Portfolio Investors (FPI)and their intermediaries in India.
A bench of Justices B V Nagarathna, R Mahadevan and D K Upadhyaya, hearing a plea filed by Trinamool Congress (TMC) MP Mahua Moitra, said there was no legal regime or framework in place for any full public disclosure about ultimate beneficial owners. The bench initially questioned Moitra for filing such a petition, saying she could have raised the issue in Parliament and sought a discussion on it.
The top court said it cannot issue any mandamus without any regime in place and disposed of the plea.
"Had there been any legal regime and the SEBI was not following it, the court could direct for compliance, but in the absence of any framework or legal regime, the court cannot issue any mandamus," it observed.
Advocate Prashant Bhushan, representing Moitra, contended that even without any regime, the court can direct SEBI to make full disclosure of the actual beneficiaries of these funds, as innocent investors are being ‘manipulated' by these investors, who boost the shares of companies.
Moitra, in her Public Interest Litigation (PIL), has sought transparency and investor awareness in India's financial markets by mandating public disclosure of ultimate beneficial owners' details as well as portfolio holdings of AIF and FPI.
SEBI regulates the securities markets in India, the plea said, and as part of its mandate, the board oversees the operations of AIFs and FPIs.