SEBI performance review put off as Madhabi Buch fails to appear before PAC

Securities and Exchange Board of India (SEBI) chairperson Madhabi Puri Buch courted fresh controversy on Thursday, 24 October after failing to appear before the Public Accounts Committee (PAC), citing "personal exigencies" as the reason for her absence.

The meeting, chaired by Congress MP K.C. Venugopal, was expected to scrutinise SEBI’s regulatory performance. Buch’s absence has stirred a political debate, with opposition MPs preparing to question her actions in relation to conflict-of-interest allegations, especially regarding investigations involving the Adani Group.

Venugopal said while Buch’s non-appearance could be seen as contempt of a legislative body, the PAC decided to overlook the incident, considering certain factors, including her being a woman. However, she is expected to appear before the PAC at a future date.

As per an Indian Express report, SEBI had earlier requested whether Buch’s presence was mandatory or if other senior officials could represent the regulatory body, but the committee insisted on her attendance.

The controversy centres around several key issues, including Buch’s previous recusals from cases owing to potential conflicts of interest. Of particular concern to the PAC is her involvement in investigations concerning the Adani Group, especially in the aftermath of the Hindenburg Research allegations.

Hindenburg has accused Buch and her husband Dhaval Buch of ties to offshore entities purportedly linked to Adani, which has further amplified demands for a parliamentary probe into SEBI’s handling of the matter.

Opposition MPs are preparing to press SEBI for answers on Buch’s potential conflicts and to seek clarity on the status of pending investigations involving offshore entities allegedly associated with Adani.

Meanwhile, members of the ruling National Democratic Alliance (NDA) at the Centre are also gearing up with their questions on the ongoing investigations. However, some BJP MPs have criticised the PAC’s decision to summon Buch, questioning whether the committee followed proper procedural norms.

Former Union minister and BJP MP Ravishankar Prasad led a group of NDA MPs in raising concerns about the way Venugopal had set the agenda and allegedly disclosed certain information to the media, which they claimed violated established norms. These MPs also met the Lok Sabha speaker.

Adding to the scrutiny around Buch are reports of her significant earnings from her time at ICICI Securities, where she reportedly accumulated Rs 16.8 crore in salary, stock options, and tax benefits during her tenure. This has sparked a debate over the financial interests of top regulatory officials, particularly those with access to unpublished price-sensitive information (UPSI).

Given the power SEBI’s decisions hold over stock markets, the PAC is likely to focus on the disclosure obligations for senior officials in regulatory bodies.

The absence of SEBI’s chairperson at this pivotal meeting has deepened the political divide over the regulation of India’s financial markets, with Opposition and ruling party members set for a contentious follow-up session.