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HC seeks Sebi reply on 'turnover fee'

The Delhi high court on Thursday allowed two weeks time to the Centre and the Securities and Exchange Board of India for submitting replies to a petition challenging framing of certain rules by Sebi regarding trading in stock market including the turnover fee.

Rejecting Sebi counsel's contention that a similar writ petition had been rejected by the Supreme Court earlier, a division bench comprising Justice Anil Dev Singh and Justice Madan Lokur directed them to file replies within two weeks and thereafter enable it to hear the matter finally on September 10.

The issue was brought before the court in a public interest litigation filed by Yogesh Jain, who claimed that Sebi was not empowered to impose turn over fee and other rules on traders without the approval of Parliament.

Petitioner's counsel Manohar Lal Sharma contended that the issues raised in the present writ petition were different from those contained in the one rejected by the apex court.

Seeking to restrain Sebi from imposing such rules which according to the petitioner "are void and illegal as well as unconstitutional", the PIL said 0.01 per cent turn over fee imposed by the Board under "Sebi (Stock Broker and Sub Broker) Regulations-1992, were contrary to the provisions of the Sebi Act.

Listing a series of rules, which according to the PIL, had not been approved by Parliament, the petitioner said these include Sebi (Insider Trading) and Sebi (Marchant Banker) Regulations of 1992, Extra Margin Rule in February 2000 and slapping of 5 per cent extra margin on sale in April 2000.

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