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The echoes of the delisting of 1,000 companies by the Bombay Stock Exchange (BSE) in 2004 have not died down and in January, the Central Information Commissioner will be hearing the second appeal under the Right to Information Act regarding inadequate information given by the BSE to the Midas Touch Investors Association on this issue.

According to the association secretary, Virendra Jain, over one million investors have lost their money because these 1,000 companies have been delisted. They have not been informed of their situation either before or after the delisting process. This says, Mr Jain has dealt a severe blow to investor’s confidence.

Why the hurry?

Of the 1,000 companies, around 400 were delisted as they were not found at their registered offices as per the records. Mr Jain says that the delisting of these companies even while the joint coordination monitoring committee (CMC) was looking into the vanishing companies was against investor interest.

Where was the hurry to delist them, he asks.

About 800 first information reports (FIRs) have already been filed with the police against the promoters and directors of 75 companies so the BSE should not have been in a hurry to delist them.

Information deficieny

The Midas Touch Investors Association had under the Right to Information Act asked the BSE for information on the orders passed by it in the delisting of 1,000 companies, the names of the person who passed the orders and the dates of such orders, and the grounds on which they were delisted.

A shareholder/investor cannot appeal against the delisting order if he does not have the details of the order. Unless investors have the details of the full procedure followed for delisting, they would not know if the procedure has been adhered to or the decision was taken arbitrarily.

The other information asked for under the RTI was, "what action did the Bombay Stock Exchange and Sebi take before and after the delisting to protect the interests of the investors, who are the small, minority shareholders in these companies."

The answers that the Association received were not satisfactory and were incomplete so they wrote back without any luck. Sebi merely passed on what information was given to it by the BSE.


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