MUMBAI, MAHARASHTRA — A special Anti-Corruption Bureau court in Mumbai on Saturday directed the agency to file a First Information Report (FIR) against former SEBI chief Madhabi Puri Buch and five other officials in connection with alleged stock market fraud and regulatory violations. The order pertains to irregularities in the listing process of a company on the Bombay Stock Exchange in 1994 and follows a complaint filed by legal reporter Sapan Shrivastava.
Special Judge Shashikant Eknathrao Bangar stated that “there is prima facie evidence of regulatory lapses and collusion, requiring a fair and impartial probe.” The court instructed the ACB, Mumbai Region, to register an FIR under the Indian Penal Code, the Prevention of Corruption Act, and the SEBI Act, and it will monitor the investigation with a status report due within 30 days.
In his complaint, Shrivastava alleged that SEBI officials allowed the listing of Cals Refineries Ltd. despite the company falling short of established regulatory norms. He claimed that this oversight facilitated market manipulation and corporate fraud, resulting in significant investor losses. The complaint contends that the statutory duty of the regulatory authorities was neglected, thus allowing improper market practices to continue unchecked.
SEBI, however, responded swiftly to the court’s directive. In a press statement released on March 2, 2025, the regulator described the complaint as being filed by a “frivolous and habitual litigant.” SEBI maintained that the officials named in the FIR were not in their positions at the time of the alleged infractions. “Sebi would be initiating appropriate legal steps to challenge this order and remains committed to ensuring due regulatory compliance in all matters,” the agency asserted.
BSE echoed SEBI’s sentiment by labeling the application as frivolous and vexatious. The exchange clarified that the officials referenced in the application were neither connected to the company’s listing process nor holding relevant positions during that period. Both regulatory bodies stressed their commitment to transparent and timely market operations despite the judicial intervention.
Madhabi Puri Buch, known as India’s first female SEBI chief, completed her three-year tenure amid controversies. Throughout her term, she faced challenges including allegations by Hindenburg Research related to undisclosed offshore investments linked to the Adani Group. Buch and her husband have repeatedly denied these allegations, maintaining that all disclosures and investments were appropriately managed according to regulatory requirements.
The court’s order has reignited a broader debate over accountability in India’s financial markets. Industry experts and market participants are closely watching the developments, with concerns about how repeated instances of regulatory inaction might undermine investor confidence. Analysts note that judicial oversight becomes critical when regulatory bodies appear to have missed key lapses.
The case has highlighted the importance of a robust framework for financial regulation and the need for continuous oversight. As the investigation unfolds, stakeholders are expecting further clarifications from SEBI and the authorities tasked with monitoring the probe. The outcome of this case may pave the way for additional transparency measures in the stock market, ensuring that regulatory bodies adhere strictly to their statutory duties.
