'Seeing Your Double Standards': Supreme Court Slams SEBI Over Reluctance In Indiabulls' Probe; Questions CBI's 'Cool Attitude'

During the hearing of Citizens Whistle Blower Forum's plea for SIT probe against Indiabulls Housing Finance Ltd. (now Sammaan Capital), the Supreme Court today slammed the Securities and Exchange Board of India (SEBI) over reluctance to probe allegations against IHFL."When question of taking over properties and selling comes, then you say we are the only authority in the country with jurisdiction. But when question of investigation comes? Because your officers have some vested interest? When we are conferring you jurisdiction, [what's the problem?] When we want to give you some authority, why are you reluctant? Every day we see double standards of SEBI! In one of the matters where I constituted a High Powered Committee, your stand was only SEBI has the right to auction the properties. And what you have been auctioning, we know that! 30 crore property, you have sold in few lakhs. When Courts are instructing, you should perform your statutory duty. You say you don't have power. Why are your officers getting salary if you do not have power?" remarked Justice Surya Kant.Notably, the judge also flagged CBI's "cool attitude" in IHFL's case and questioned Ministry of Corporate Affairs' alleged compounding of about 100 violations in the span of 2 days."Very surprisingly CBI has a very cool kind of attitude and approach in this case. We have never seen such a friendly attitude, as we find in this case. We are sorry to observe like this. This is ultimately public money, it's not somebody's private self-earned money that is being circulated. There is strong element of public interest. Even if 10% allegations are correct still there are some large scale transactions which can be dubbed as dubious. Once doubt is created, you register an FIR. It need not be against A person, B person. During investigation, somebody may or may not be found involved. But registering an FIR will strengthen the hands of the ED, SFIO, SEBI. What really prevents the authorities? Why is the MCA indulging in closing the matter like this? What is their interest in this?" exclaimed Justice Kant.A bench of Justices Kant, Ujjal Bhuyan and N Kotiswar Singh heard the matter. Briefly put, the case raises allegations of serious illegalities, including round-tripping of funds, violations of provisions of the Companies Act, and siphoning of funds committed by the promoters of Indiabulls, its subsidiaries and their promoters.Earlier, the Court noted from the CBI's response that money laundering allegations were prima facie found to be well-placed and the agency stated that ED may continue probe into Indiabulls and its promoters' affairs.Today, the issue of no FIR having been registered qua predicate offense persisted. Additional Solicitor General SV Raju (for CBI and SFIO) apprised the Court about efforts made by the agencies before a Magistrate's court [in form of complaint under Section 156(3) CrPC], EOW Delhi, etc, which have not fructified. Advocate Prashant Bhushan (for petitioner) prayed that the Court order registration of an FIR by CBI, as there is a strong case for investigation based on affidavits filed by CBI and SEBI.Bhushan also proposed a Special Investigation Team comprising senior officers from CBI, SFIO, ED and SEBI.Ultimately, ASG Raju assured that a meeting will be convened by the CBI Director, involving senior officers of all these agencies. At this point, it came forth that SEBI was being represented by another counsel, not the ASG. This counsel apparently expressed reluctance, and as such, Justice Kant passed strong remarks against the agency.Besides the above, the Court also called for a fresh affidavit from the CBI, after ASG Raju stated that a fresh complaint would be made by ED to CBI. The Court further directed Commissioner of Police, Delhi to depute a senior officer of EOW to produce the records pertaining to "inquiry" made on ED's complaint as well as the conclusion that the ED complaint did not disclose any cognizable offense.Case Title: CITIZENS WHISTLE BLOWER FORUM v. UNION OF INDIA, SLP(C) No. 2993/2025Click Here To Read/Download Order

'Seeing Your Double Standards': Supreme Court Slams SEBI Over Reluctance In Indiabulls' Probe; Questions CBI's 'Cool Attitude'

Debby Jain

"Why your officers getting salary if you don't have power?" Justice Kant said to SEBI counsel.

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