'Rental income from another Mumbai property': Congress fires fresh charge against Sebi chief Madhabi Buch

The Congress on Tuesday levelled fresh charges against Sebi chairperson Madhabi Puri Buch, claiming that she rented another one of her properties to Green World Buildcon and Infra Private Limited, a company owned by individuals associated with Indiabulls. By doing so, the party said, Buch violated several sections of Sebi's Code of Conduct. 

Buch owns another flat in Mumbai, Congress leader Pawan Khera said in a press briefing. "In 2021-22, she earned rental income from a property rented out to a company called Green World Buildcon and Infra Private Limited. This company is owned by Mukul and Vipul Bansal. Mukul Bansal has a significant background with Indiabulls Group, being part of its senior management and on the board of several related companies."

The Congress leader alleged that Indiabulls, where Mukul Bansal has been involved, has faced several cases with Sebi, with multiple adjudication orders and regulatory actions between 2021 and 2022. Besides Sebi actions, it added, the company has also been involved in cases before other regulators and courts, and Sebi has provided affidavits in those cases.

Khera also accused Buch of holding of unlisted shares and its connection with Paradise Papers. He said Predible Health Private Limited was incorporated on 2 May 2016. As an initial shareholder, Buch has been associated with the company holding equity in it, he claimed. "She continued to hold shares in the company even after becoming a Whole time member of Sebi."

"It was during FY 2021-22, she sold the shares to a US company (M/s Nference Inc.) making a return of ~226 times in 5 years. Further, Predible Health Private Limited was a start-up company which received funds under the Startup India initiative of the Government of India."

The Congress leader shared a list of 8 inestors in Predible and one of them is Jacesa Investments Limited. According to Khera, Jacesa Investments is based out of St Vincent and The Grenadines that lies in the eastern Caribbean Sea. "Jacesa's name is listed in offshore leaks by Paradise Papers (2017) shared by ICIJ. This implies that Jacesa Investments is compromised and needs to be investigated in detail."

Congress communication incharge Jairam Ramesh asked why Buch rented out her property to a company associated with Indiabulls, which was not only regulated by Sebi but was under its scanner for various cases. He also asked why Buch held shares in a conflicted entity that had its connections to the Paradise Papers.

Not just Buch, Sebi whole-time member Ananth Narayan also received rental income from a stock-broker employed with a brokerage firm, the Congress leader claimed. As per the details shared by Congress, after joining Sebi, Narayan received Rs 64.8 lakhs in rent from a property he owns in Mumbai. "The tenant is Thangam Vinod Rajakumar, a stockbroker hired by a brokerage firm called IMC India Securities, which is regulated by Sebi." 

"This suggests a potential conflict of interest since Narayan oversees the regulation of brokers by virtue of being a member of the Market Intermediaries Regulation and Supervision Department (MIRSD)," the Congress leader said, pointing to violations of Sebi's Code on Conflict of Interest for Members of Board (2008). 

Khera also said that Narayan is a whole-time Sebi member, but he holds shares worth Rs 70 crore of Incred Capital. "That too when Incred Capital comes under the purview of SEBI's investigation."

In September this year, Congress had alleged that Buch and her husband received rental income from a company affiliated with Wockhardt Ltd, a firm that SEBI has been involved with in multiple cases. However, Wockhardt denied the charge, saying: "There are certain allegations pertaining to payment of rent by Carol Info Services Limited and its connection with certain orders passed by SEBI in relation to the company. In this regard, we categorically deny these allegations and state that these allegations are completely baseless and misleading. The company has acted and continues to act in compliance with all applicable laws."