SC dismisses Sebi review plea in RIL matter

Market


The Supreme Court on Friday dismissed a petition by Securities and Exchange Board of India (Sebi), seeking review of a 5 August order, directing the market regulator to share certain documents with Reliance Industries Ltd (RIL).

RIL claims that certain relevant documents will exonerate it and its promoters from prosecution in a case related to the alleged irregularities in buying its own shares in 1994-2000. Sebi refused to entertain RIL’s plea to share the documents on the grounds that under the Sebi (Settlement Proceedings) Regulations, the accused company has no right to seek information from it.

The apex court, in its earlier judgment, rejected Sebi’s plea.

On Friday, a Supreme Court bench, led by the former Chief Justice U.U. Lalit and comprising Justices J.K. Maheshwari and Hima Kohli, dismissed the regulator’s plea by a 2:1 majority opinion.“In view of a majority opinion, the review petition stands dismissed…”, it said.

On 29 September, Sebi had filed a review petition before the apex court, and the court agreed to hear it in an open court, before listed the matter for hearing on 12 October.

Justice Kohli in her order of 30 September said: “Having carefully examined the contents of the review petition, there is no valid reason to review the judgement dated 5 August. The grounds urged do not fall under the restricted scope of the review petition, hence, the review petition ought not to be entertained.”

This led the court to recall the matter from being heard in an open court. Subsequently, RIL informed the court that despite repeated requests the regulator did not provide the documents to the company. Last week, the apex court had also issued a contempt notice to Sebi for not following its order.

Sebi had initiated a probe after receiving a complaint from S. Gurumurthy on 21 January 2002 against RIL, its associate companies and directors, alleging that they had fraudulently allotted 120 million shares of RIL to entities connected with promoters of RIL, which were funded by the firm and other group entities.

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