New Delhi (The Hawk): By a 2:1 majority decision, the Supreme Court rejected a petition from the Securities and Exchange Board of India (SEBI) that asked for a review of its August 5 decision ordering the market regulator to release specific documents with Reliance Industries (RIL).
A bench composed of Justices J.K. Maheshwari and Hima Kohli and presided over by former Chief Justice U.U. Lalit made the following ruling: "By decision dated October 19, 2022, the Chief Justice of India ordered that notice be given in the review petition. By order dated October 19, 2022, Justices J.K. Maheshwari and Hima Kohli dismissed the Review Petition. The Review Petition is dismissed in accordance with the written orders in light of the majority opinion. Any applications that are still pending will be dismissed." In their majority judgement, Justices Maheshwari and Kohli stated: "The Review Petition was given notice by the Chief Justice of India in an order dated 19.10.2022, which was due back on 23.11.2022. With all due respect, we are unable to concur with the same since we have already stated in our separate orders dated 30.09.2022, that the Review Petitioner has not established any grounds for a notice to be issued or for a review of the decision this Court made on 5.8.2022, when it dismissed Criminal Appeal No. 1167 of 2022." In a previous step related to the lawsuit, the Supreme Court had also served SEBI with a notice of contempt for allegedly failing to comply with the court's decision dated August 5 that required the market regulator to grant the business access to certain records.
Justices M.R. Shah and M.M. Sundresh were on the court when they said: "Send the respondent notice that it is returnable on December 2, 2022. On behalf of the respondent, Abhishek Singh, attorney, accepts delivery of the notice." In its ruling, the bench presided by by Justice Shah stated: "We have reviewed the following order issued by this court on October 12, 2022 in the review case. The status of a review petition cannot be compared to the status of an appeal, writ petition, or both, coupled with a stay.
"This court has made a final determination about an appeal. The respondent cannot obtain a stay on its own and disregard the orders given by this court just because the stay application is still pending in the review case." Because the accused business does not have the authority to request information from the market regulator under the SEBI (Settlement Proceedings) Regulations, the market regulator declined to consider RIL's request to divulge the confidential papers.
The Supreme Court of India rejected this position of the market regulator in its ruling on August 5.
RIL had argued that certain papers would shield it and its promoters from any criminal charges brought against them in connection with the purported irregularities in the purchase of its own shares between 1994 and 2000.
On August 5, a bench presided over by former Chief Justice N.V. Ramana had stated: "Transparency and a fair trial are also raised by SEBI's strategy of withholding the documents. Opaqueness only serves to reinforce bias and prejudice. Transparency is opposed to opacity." The top court had ruled that SEBI has a responsibility to act fairly when conducting hearings or taking any action against the parties and should demonstrate impartiality and provide the papers requested by RIL.
RIL filed a contempt complaint against Sebi because it hasn't provided access to three documents: the two legal opinions written by former SC judge B.N. Srikrishna and the report written by former ICAI president YH Malegam that looked into the anomalies.
The corporation asserted that SEBI cannot continue to oppose the disclosure of these records. The regulator was also warned that if the documents were not obtained by August 18 then Sebi did not intend to abide by the ruling of the supreme court.
S. Gurumurthy, a chartered accountant, filed a complaint with Sebi in 2002 alleging irregularities by RIL, its affiliated companies, and their directors and promoters, including Mukesh and Nita Ambani, Anil and Tina Ambani, and 98 other people.
Two non-convertible debentures were placed preferentially twice in 1994, according to the complaint.
According to SEBI, RIL and Reliance Petroleum circumvented Sections 77 and 77A of the Companies Act of 1956 to illegally fund the purchase of their own shares.
(Inputs from Agencies)