The Bombay High Court on Friday said Sebi has the power to initiate proceedings against Price Waterhouse (PW) in its alleged role in the Satyam scam while disallowing a writ filed by the auditor. However, the court had asked Sebi to stay its proceedings for four weeks to probablyenable the petitioner PW to file a special leave petition with the Supreme Court.
While allowing Sebi to proceed against PW, the court said that the jurisdiction to take action against the auditor will depend on the available evidence on hand. ?Sebi should decide on the matter of jurisdiction based on the available evidence at the time of passing its final orders,? ruled the high court.
PW moved Bombay High Court requesting it to quash the proceeding initiated against it by the market regulator after the chairman of Satyam Computers, B Ramalinga Raju admitted to major fraud in its books of account, which was audited by PW. Sebi had sent a show cause notice to PW asking why they should not be debarred from auditing books of listed companies. According to the audit firm, the market regulator has no jurisdiction to initiate action against it as it is registered only with the ICAI and hence only responsible to it.
PW in a statement said, ?We are informed that the HC has disallowed our writ petition challenging Sebi?s jurisdiction over accounting and auditing professionals. We are awaiting the HC written order, which we will examine to decide our next course of action including the option of filing an appeal to the Supreme Court.?