The Supreme Court today upheld the appointment of U K Sinha as SEBI chairman, saying it was done by the Centre in accordance with the law and rejected the contention that Omita Paul, who was adviser to the then finance minister, had influenced the decision making process.
A bench of justices S S Nijjar and P C Ghose dismissed the PIL challenging the appointment saying that allegations made against Paul, now President Pranab Mukherjee's Secretary, are "imaginary" and the petitioner is a surrogate for some "powerful phantom lobbies".
"In our opinion, the petitioner has unjustifiably attacked the integrity of the entire selection process. It is virtually impossible to accept the submission that respondent No.6 (Paul) was able to influence the decision making process which involves the active participation of the ACC (appointment committee of cabinet), a high powered Search-cum-Section Committee with the final approval of the Finance Minister and the Prime Minister."
"The proposition is so absurd that the allegations with regard to mala fide could have been thrown out at the threshold," the bench said.
The PIL was filed by one Arun Kumar Aggarwal on whose case the apex court had on September 26, last year, issued notice to the Centre and SEBI and had also impleaded Paul.
The apex court said the petition does not satisfy the test of utmost good faith required to maintain PIL and it was filed at the behest of certain interested powerful lobbies.
"We have been left with the very unsavoury impression that the petitioner is a surrogate for some powerful phantom lobbies" the bench said.
"It is a well known fact that in recent times, SEBI has been active in pursuing a number of cause against some very powerful business houses. Therefore, the anxiety of these business houses for the removal of the present Chairman of SEBI is not wholly unimaginable," it said.
The apex court rejected the plea of the petitioner that Centre had refused giving extension to earlier SEBI chairman C B Bhave just to bring Sinha as head of the market regulator.
The bench said the petition could have been dismissed as not maintainable for a variety of reasons but it chose to examine the entire issue to satisfy judicial conscience that the appointment to such a high powered position has actually been made fairly and in accordance with the procedure established by law.
"We are inclined to accept the submission of the Solicitor General that the allegations made against Paul are imaginary and based on a distorted interpretation of the official notes appended with the writ petition," the bench said.
"We are also unable to see any merit in the submission of the petitioner that the post of CMD, UTI AMC was kept vacant for 17 months to accommodate the brother of Paul. In our opinion, the allegations are malicious and without any basis, and therefore, cannot be taken into consideration," the bench said.
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