BIG blow to Mukesh Ambani-controlled Reliance Industries, Supreme Court upholds SEBI fine of Rs...for...

In what may be called a big blow to the Mukesh Ambani-owned conglomerate, the Supreme Court has upheld the order of the Securities Appellate Tribunal to impose a fine of Rs 30 lakh on Reliance Industries Limited for noncompliance with the timely disclosures related to the Facebook-Reliance Jio deal. A bench comprising Chief Justice of India Surya Kant and Justice Joymalya Bagchi said, "The issue dealt with by SEBI and SAT is substantially a question of fact, giving rise to no substantial question of law to be considered by the court."

Supreme Court upholds SEBI fine on Reliance

The Securities and Exchange Board of India (SEBI) ordered RIL and two of its compliance officers, Savithri Parekh and K Sethuraman, to pay Rs 30 lakh on June 20, 2022. The fine was imposed for an alleged violation of Principle 4 of Schedule A to the SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations). SEBI argued that RIL had failed to promptly and transparently disseminate unpublished price-sensitive information (UPSI) relating to Facebook’s proposed investment in Jio Platforms Limited after the details appeared in international media in March 2020.

Replying to the SEBI order, Reliance Industries said that Regulation 30(11) of the SEBI LODR Regulations was discretionary and the company was not bound to confirm or deny speculative reports unless directed by the stock exchanges. It also argued that the information was neither “concrete” nor “credible” until the execution of binding documents and therefore was not UPSI requiring immediate disclosure.