It is the system, stupid!

The system, which consists of bureaucrats, politicians, and corporates must be set right

The system, which consists of bureaucrats, politicians, and corporates must be set right
The system, which consists of bureaucrats, politicians, and corporates must be set right

It is heartening to note that Prime Minister Narendra Modi has identified the bureaucracy as one of the key things that need changing. By January 31st, all IAS officers must submit details of their assets – failing to do so would lead to a denial of vigilance clearances that is mandatory for promotions and overseas postings[1]. While this is a welcome step, many more such steps are needed to cleanse the system. I am going to dwell on just one agency which, by its inaction has clogged the system.

SEBI needs to remember the primary goal for which it was created – to serve and protect the interests of the shareholders. And it has failed in this.

Securities and Exchange Board of India (SEBI)

This agency has been frequently highlighted in PGurus articles as being the cause for not allowing several other agencies to do their work, especially in the case of New Delhi Television (NDTV). There are other cases too, but let me explain why the role of SEBI is critical.

SEBI is the voice of the investor, large and small. If the investor feels that he/ she is wronged, it is the duty of the SEBI to ensure that justice is done. To this end, it must ensure that all the listed companies (and the ones who would like to go public) play by the rules.

What are SEBI’s functions?

SEBI enforces orderly operation of capital markets primarily[2] through four Regulations passed under the SEBI Act, 1992:

  • SAST (Substantial Acquisition of Shares & Takeover Regulations)
  • PIT (Prohibition of Insider Trading Regulations)
  • FUTP (Prohibition of Fraudulent and Unfair Trade Practices Regulations)
  • LODR (Listing Obligations & Disclosure Regulations) i.e. Disclosure/Listing violations

This series detailed the several violations committed by NDTV in each of the above four regulations[3]. Yet, SEBI has been silent, till date. In fact, it has been dodging searching questions by the Delhi High Court on this subject! SEBI is due to appear this week in Delhi High Court to give status on the various violations committed by NDTV[4]. I sincerely hope that they deliver on the several issues that are pending.

Why do BJP ministers keep showing up at NDTV?

It continues to amaze me that some Bharatiya Janata Party (BJP) ministers continue to appear in this channel, which went after their leader with a single-minded dedication after the 2002 riots. Despite having ordered NDTV to go off-air for a 24-hour period, no Information and Broadcasting Minister has dared to take this step. Worse, one of NDTV’s anchors, Nidhi Razdan ordered the BJP spokesperson Sambit Patra off her program[5]! Don’t you (by you I mean the small set of ministers who frequent NDTV) have any self-esteem? Should you not insist on NDTV to give you an unconditional, public apology before showing up at their channels? Why this snub-appeal? What makes NDTV feel brazen that it can do whatever it feels like doing?

The table below shows the list of SEBI violations by NDTV:

Sl. No. Description SEBI Violation
1 Insider Trading (PIT violation) with General Atlantic Partners (an FII) that triggered the Takeover Code (i.e. SAST) during the period 11.12.2007 to 30.12.2007
2 Fraud and manipulation (Securities Fraud) in transactions and various other actions with Goldman Sachs & Co (Mauritius) during the period 1.2.2008 to 30.7.2008
3 ICICI Bank transaction under LODR/ Listing Agreement and FUTP being investigated by the Central Bureau of Investigation (CBI), India
4 Insider Trading, FUTP and SAST violations in agreements with Vishvapradhan Commercial P. Ltd. (VCPL) during the period 18.7.2009 to 31.03.2010 that has led to change in Control of the Company and then again transfer of ownership of VCPL to Mahendra Nahata group in 2012. In 2011 DG Investigation Income Tax determined that VCPL is a front for RIL Group. Even Business Standard has written extensively about this.

It is pertinent to point out that all evidence in the form of illegal agreements signed by the Roys, email exchanges on insider trading and fraud and many other cogent pieces of evidence have been submitted with SEBI since 2014. Further, all documents are also filed and available with SEBI as part of Delhi HC Writ No. 11148 of 2015 (Quantum Securities P Ltd. vs SEBI).


Not just PGurus even noted TV Political Commentator and Editor of Thuglak, S Gurumurthy had written to the SEBI Chairman Ajay Tyagi, requesting him to look into the inaction of SEBI against NDTV[6].

In case of Quantum Securities, a private shareholder in NDTV, SEBI has been refusing to meet with them for just to hear out the intricacies and details in their complaints! Quantum Securities has repeatedly sought an opportunity to be heard and depose with evidence before SEBI for the last 2 years. Isn’t this a statutory right of a complainant before a body that is set up for his protection? Will it need directions from the Delhi High Court to do even this? SEBI needs to remember the primary goal for which it was created – to serve and protect the interests of the shareholders. And it has failed in this.


[1] Away from the headlines, Modi is taming the bureaucracyDec 28, 2017, The Economic Times

[2] SEBI’s inaction on NDTV and understanding the violations of NDTVOct 22, 2017,

[3] SEBI InactionOct, 2017,

[4] ED informs Delhi HC on registering cases against NDTV & RRPR for money launderingNov 3, 2017,

[5] NDTV’s Nidhi Razdan orders Sambit Patra off her showJun 2, 2017, Business Standard

[6] Gurumurthy writes to SEBI Chairman about NDTVOct 5, 2017,

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An inventor and out-of-the-box thinker, Sree Iyer has 37 patents in the areas of Hardware, Software, Encryption and Systems.

His first book NDTV Frauds has been published and is an Amazon Bestseller.It ranked second among all eBooks that were self-published in 2017.

His second book, The Gist of GSTN which too is available on Amazon as an e-Book and as a paperback.

His third book, The Rise and Fall of AAP is also available in print version or as an e-Book on Amazon.

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  1. Narendra Modi is always afraid that Congress will criticize. Congress leaders openly attack Modi by taking his name but Modi does not counter attack. This is sign of fear.

  2. I am amazed and ashamed that all BJP MP’s are in hurry to show themselves on NDTV channel. What is that “magnetism” to which they are drawn is unknown. Is it some sort of foreign mafia that this policitians are “afraid to bite” ?
    In India there is NO action (total inaction only). Everything is lft to the God – karma siddantam. No effort is made to improve the credibility or morality or trust worthiness which our scriptures tell endlessly in sentence & word.
    Gives me doubt that BJP is also equally corrupt as Khangress


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