We can regulate unlisted companies if they raise public funds, says SEBI

Market watchdog SEBI on Thursday claimed before the Securities Appellate tribunal (SAT) that the Companies Act gives it enough powers to regulate unlisted companies if such entities have raised funds from the public. “Does SEBI have powers under Section 55A of the Companies Act? My answer is yes. If OFCD is a security under the Securities Act, then it comes under the SEBI Act. And if it comes under the SEBI Act, then SEBI has jurisdiction. SEBI can (therefore) pass a special order to regulate unlisted companies,” SEBI's Counsel, Mr Arvind P. Datar, claimed before SAT. Mr Datar was contesting Sahara Group's claim that its OFCD (optionally fully convertible debentures) were not a public issue and, therefore, cannot be regulated by SEBI.

Source : http://www.thehindubusinessline.com/markets/article2440015.ece