SEBI has appointed a former chief commissioner of income-tax, Mr Vijay Ranjan, as administrator for reallocation of unjust gains in the IPO scam (2003-05) to the unsuccessful retail applicants. Mr Ranjan was also associated with SEBI as an Executive Director.

Justice D.P. Wadhwa Committee report had directed SEBI to appoint an administrator for reallocation of the money.

The totally unsuccessful applicants will be paid first. The report has recommended that the amounts to be allocated will be computed as the “difference between the closing price of shares on the first day of listing/trading on the NSE and the IPO issue price.”

Such applicants will receive the gains associated with the minimum shares allotted to the lowest category in the IPO.

SEBI has identified 21 such IPOs, including that of IDFC, NTPC, TCS, YES Bank and Suzlon Energy.

SEBI has been successful in disgorging a part of the ill-gotten gains made by the key operators and financiers involved in the IPO scam.

About Rs 20 crore has been disgorged so far, mostly through consent proceedings. The amount to be disgorged according to SEBI order works out to Rs 115.82 crore.

The committee also noted that the key operators and financiers in the scam had holdings worth Rs 147.85 crore in their frozen demat accounts with NSDL and CDSL.

In addition, around Rs 1.2 crore in their bank accounts has been frozen by the CBI. The committee has said the reallocation should be possible from these frozen accounts.

The committee was constituted in July 2007 to advise on and recommend the procedure for the identification of persons who might have been deprived of allotment on account of the IPO irregularities, and the manner of compensation to them.

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0 responses to “SEBI appointed former CIT Vijay Ranjan, as administrator for reallocation of unjust gains in IPO scam”

  1. A.BANERJEE says:

    Congratulations to Mr. Vijay Ranjan on this recognition by the SEBI. This is an honour for the entire IRS.

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