New Delhi: The Supreme Court on Friday sought responses from the Centre, RBI, market regulator Sebi and CBI on a plea seeking a direction that the offshore portfolio investors, who invest in the Indian stock market through participatory-notes, should not be allowed to withdraw the money till further orders. A bench of Justices Dipak Misra and C. Nagappan issued the notice on the interim application, which was filed by advocate M.L. Sharma in his pending PIL seeking a CBI probe against Indian offshore bank account holders named in the Panama papers.
P-notes are derivative instruments issued by registered foreign portfolio investors to overseas investors to enable them trade in stock market here without getting registered with Sebi. Mr Sharma has referred to a recent proposal of Sebi which increases disclosure requirements for issuance of P-notes and said this would lead to siphoning of monies by investors. The new rules enable the regulator to check the complete transfer trail of P-notes money on a monthly basis.
“Around Rs 25 lakh crore black money which is floating in the stock market would be siphoned off. FIIs are Indian investors who have invested through P-notes,” he said. Besides seeking an ex-parte stay on release or transfer of P-note amount till further orders, the plea has sought a direction from the Supreme Court to the finance ministry and others including the CBI to “seize entire black money/participatory notes”.
