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JPC narrows probe focus to scrip movement of 12 firms

Subhomoy Bhattacharjee

After giving some anxious moments to corporate India, the Joint Parliamentary Committee has decided to focus its probe on the movement of the shares of only about 12 companies against whom it feels there is a reason to proceed further.

In an internal report, the committee has identified DSQ Software, Lupin Lab, Zee Telefilms, Global Telefilms, HFCL, Satyam Computers, GTB, ICICI Bank and others largely based on the special report of the Securities and Exchange Board of India, which had investigated the movement in the scrips of 185 companies.

But the internal report also adds that the Sebi interim report while dealing with the manipulation of the scrip prices has not implicated these companies per se of any wrongdoing.

It says "the report however does not appear to have discussed whether the corporate bodies had any role in the manipulation of prices of (their) scrips in stock markets".

The period of price movement that has been covered in the Sebi report is from March 1999 to March 2000 for most of these companies.

According to the JPC report, these are the "scrips in respect of which manipulation or irregularities" have been noticed.

The committee has said that as per the Sebi report, the shares of these companies figured in the list of both excessive upward and downward mobility. It has exonerated companies like Wipro and Nirma against which the report says there is no evidence regarding manipulation or irregularity.

The committee's preliminary findings have also been discussed in an internal meeting of the members held in November to finalise the contours of its report on the first phase of its mandate.

From January 4, 2002 the committee will be largely enquiring into the affairs of Unit Trust of India, especially the US-64 fiasco.

The committee has therefore left off the hook a large number of companies that had been named by the market regulator.

According to sources close to the committee, the decision is based on the realization that it will be well nigh difficult to conduct such a mammoth inquiry especially as the evidence in many cases will need to be further strengthened by investigating agencies.

The report says that along with these cases, detailed investigations are still in progress for broking groups including Ajay Keyan, JM Morgan Stanley, and BLB Limited.

According to the report, many of the companies mentioned here also figured in the first Sebi interim report. In addition, the report says the market regulator had mentioned Cyberspace Infosys, Amara Raja Batteries, and Ranbaxy Laboratories.

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