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Plea against D R Mehta: HC issues notice to SEBI, Centre

The Delhi high court today issued show-cause notices to the Central government and the Securities and Exchange Board of India on an application for restraining the SEBI chairman D R Mehta from continuing in his post.

A division bench comprising acting Chief Justice Mahinder Narain and Justice Mukul Mudgal directed the respondents to file their reply by November 30, the next date of hearing in the matter.

The application filed by Arun Kumar Aggarwal challenged the continuance of Mehta as the chairman of the SEBI in spite of expiry of his three-year tenure on February 20 this year.

Counsel for petitioner Prashant Bhushan contended that the continuance of Mehta as the SEBI chairman was illegal and contrary to the SEBI (terms and conditions of services of chairman and members) Rules 1992 made under the SEBI Act.

The application also prayed for disclosing and making accessible all reports and quasi-judicial orders of the SEBI as the board had been unreasonably and illegally withholding them in contravention of the fundamental rights of citizens guaranteed under Article 19 (1) (a) of the Constitution.

In view of the facts, it would be in public interest that Mehta was restrained to continue in his post.

The court also admitted the petition of Aggarwal, claiming to be an expert in financial matters, seeking an order to the Cabinet Secretary not to reappoint Mehta as the SEBI chairman in view of his failure to protect the interests of the investors.

UNI