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MUMBAI: Both the Union government and the Unit Trust of India (UTI) have failed to take any action
against tainted UTI officials, as well as against corporates exposed by the Tarapore committee way back in
January 2002.

This is evident from the Action Taken Report (ATR) tabled before Parliament on May 10 about the JPC
report regarding the 2001 stock scam.

The final JPC report had recommended an enquiry of the secondary market transactions done by UTI in
shares of 89 companies identified by the Tarapore committee. It had also recommended departmental
action against UTI officials involved in Cyberspace scam.

Moreover, Tarapore panel had exposed the deals behind the US-64 crisis and how banks had privy
information regarding the ill-health of the scheme.

However, in terms of action taken against these findings, both the government and UTI have failed to
finalise any proceedings against the accused other than referring a few cases to the Advisory Board on
Banking, Commercial and Financial Frauds, a pre-investigative body under the finance ministry.

Some of the companies involved in these cases include Global Tele, DSQ Software, Essar Oil, Zee
Telefilms, Essar Steel and HFCL. UTI chairman M Damodaran was unavailable for comment.

After the Tarapore committee report unearthed the dubious deals between UTI officials and leading
corporates, UTI ordered an audit of the investment decisions taken in 19 firms. But no action has been
taken against these companies or against the concerned UTI officials.

The UTI-1 administrator has informed the government that with reference to civil proceedings against ex-
chairman PS Subramaniam and other former UTI officials, "UTI is seeking an external legal specialist and
further action will be considered on their advice."

On UTI's role in the Calcutta Stock Exchange payment crisis, the government has directed SEBI to
intervene in the matter, since UTI has failed to initiate any action against its former ED BG Daga, who has
been indicted in the JPC report.
Sources said the regulator is expected to summon Daga for a hearing in this matter. SEBI has also ordered
an investigation to ascertain any broker nexus among Stock Holding Corporation (SHCL) officials.‘
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