The Court agreed to hear SEBI’s appeal regarding SAT’s decision to grant relief to RIL and has scheduled the matter for hearing on December 2.
NEW DELHI: The Supreme Court on Monday( 11th Nov) rejected an appeal filed by the Securities Exchange Board of India (SEBI) challenging the Securities Appellate Tribunal’s (SAT) decision to cancel a penalty imposed on Mukesh Ambani, Chairman of Reliance Industries Limited (RIL), over allegations of manipulating Reliance Petroleum Limited’s (RPL) stock in 2007.
A Bench of Justices JB Pardiwala and R Mahadevan stated,
“There is no question of law raised in the case. Dismissed.”
However, the Court agreed to hear SEBI’s appeal regarding SAT’s decision to grant relief to RIL and has scheduled the matter for hearing on December 2.
Senior Advocate Arvind Datar, representing SEBI, argued that the case involved the vicarious liability of the Managing Director and pointed out conflicting SAT rulings on the issue. The Court declined to entertain the plea regarding Ambani.
Senior Advocates Harish Salve and Ritin Rai represented Ambani and RIL, respectively.
BRIEF FACTS
In December 2023, the SAT set aside SEBI’s order to penalize Ambani and RIL over the 2007 RPL stock manipulation case. The dispute involved the sale of a 5% stake in RPL, which was later merged into RIL in 2009. In 2021, SEBI imposed a Rs 25 crore penalty on RIL, Rs 15 crore on Ambani, Rs 20 crore on Navi Mumbai SEZ, and Rs 10 crore on Mumbai SEZ, alleging manipulation of RPL’s shares during the sale.
Four appeals were filed against SEBI’s order at SAT, which ultimately ruled that Ambani could not be held responsible for the corporate violations. It noted that evidence from board meeting minutes showed that the trades were executed by others without Ambani’s knowledge. As a result, the tribunal quashed the fines against Ambani and RIL.
