SEBI's power to seek call data records in securities investigations is valid, subject to privacy safeguards and recorded reasons.

SEBI's statutory powers under the SEBI Act were interpreted broadly to include calling for relevant information in a securities investigation, including call data records and tower location details held by telecom service providers. Section 5(2) of the Indian Telegraph Act was confined to interception or detention of messages and was not a bar to seeking static call records. Because the power could affect privacy, it was limited to persons under investigation or inquiry, had to be exercised by duly authorised officers, required recorded reasons showing application of mind, and could not be used for a fishing enquiry. SEBI was therefore entitled to seek such records subject to these safeguards.

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Issues: Whether the Securities and Exchange Board of India has power to call for call data records and tower location details from telecom service providers in the course of an investigation or inquiry, and whether Section 5(2) of the Indian Telegraph Act, 1885 bars such a request.

Analysis: The statutory scheme of the Securities and Exchange Board of India Act, 1992 confers wide powers on the Board to protect investors and regulate the securities market. The power to call for information under Section 11(1) read with Section 11(2)(i) and Section 11(2)(ia), together with the civil court powers under Section 11(3) and the investigative power under Section 11C(3), was treated as sufficient to reach information relevant to a securities investigation, including call data records held by telecom service providers. The later ordinances substituted Section 11(2)(ia) to expressly include information and records from any person, which removed any remaining doubt. Section 5(2) of the Indian Telegraph Act, 1885 was held to govern interception or detention of messages and not the calling for static call records. At the same time, the power was recognized as capable of affecting privacy, so it was confined to persons under investigation or inquiry, had to be exercised only by duly authorized officers, and required prior recording of reasons showing application of mind. The request could not be used for a fishing enquiry.

Conclusion: SEBI was held entitled to call for call data records and tower location information from telecom service providers for a live investigation or inquiry, subject to the stated safeguards, and Section 5(2) did not prohibit such action.

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