SC asks Sebi to give documents to Reliance in share acquisition case

The Supreme Court on Friday asked the Securities and Exchange Board of India (SEBI) to give Reliance Industries Ltd access to documents used to investigate a share acquisition matter, saying it is the “duty of the regulator to act fairly”.

Reliance had moved the apex court after the Bombay High Court rejected its petition to access the documents SEBI relied upon to charge that there were irregularities when the company bought its own shares between 1994-2000.

“SEBI as a regulator has a duty to act fairly. It is not to circumvent the rule of law and has to show fairness. We direct SEBI to furnish the document sought by RIL [Reliance],” said the apex court this morning.

The court, earlier this year, had advised the regulator to give Reliance access to the documents but did not issue an order. SEBI had termed these documents as “privileged information”.

The court in May told SEBI that the document must be in favour of the company, or else it (Reliance) would not have asked about it. SEBI should give the copy to the accused, the court said. It observed that once a document is relied upon by the prosecutor, the defendant has a right to its access for a fair trial.

Chartered accountant S Gurumurthy filed a complaint against Reliance in 2002, alleging irregularities in its associate companies, its promoters, including Mukesh Ambani and his wife, Nita; and 100 others in the issue of two preferential placement of non-convertible debentures in 1994.

Acting on the complaint, SEBI moved a lower court in Mumbai in 2020 to initiate prosecution against the company. The court rejected the plea saying there was a delay of 18 years in acting on the complaint and was time-barred.

Reliance then filed a plea in the Bombay High Court and requested SEBI to furnish documents regarding the investigation. The High Court rejected the plea and Reliance approached the apex court.

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