Market regulator Sebi today rejected the request of Price Waterhouse Bangalore lawyers to let them cross-examine the disgraced founder-chairman of Satyam Computer Services B Ramalinga Raju and his associates, accused in the Rs 14,000 crore accounting fraud.

Sebi has also rejected their plea to cross examine the company's former managing director B Rama Raju, ex-CFO Vadlamani Srinivas and statutory auditor Srinivas Talluri.

However, the lawyers representing the audit firm have been allowed to cross-examine eight people, including G Ramakrishna, Satyam's former Vice-President (Finance).

Sebi gave its ruling after hearing the counsels following showcause notices (SCNs) given to various associate firms of Price Waterhouse, Lovelock & Lewes, and Dalal & Shah, in the Satyam accounting fraud case.

"I find that no recorded statement of Raju has been relied upon in the SCNs... I, therefore, do not find that a case has been made out for cross-examination of Shri Ramalinga Raju," the market regulator said.

Sebi said that although an opportunity for cross- examination is a law of natural justice, in this case, it should be exercised with caution.

It notes, "I have to keep in mind that the public interest is served by a speedy completion of these proceedings without, however, compromising on the requirements of adherence to principles of natural justice and that a long delay would rob them of much of their purpose.

"In the present case, it is already eight months since the hearing commenced, and hardly any progress has been made in the matter."

Earlier, Price Waterhouse had challenged in court Sebi's jurisdiction over audit firms, contending that accounting regulator  ICAI was the authority concerned and it was already looking into the auditor's role in the Rs 14,000 crore scam.

On the eight people that have been allowed to be quizzed, Sebi said all cross-examinations would be held on dates, time and venue, to be notified soon, and no adjournments would be granted.