The 2007 Reliance Industries Ltd (RIL) insider trading case has reached the Bombay High Court, with a Bangalore-based lawyer seeking information under Right To Information (RTI) Act, filing caveats against any potential appeal by the market regulator against a recent order by an apex RTI body.
On November 6, the Central Information Commission (CIC) had directed the Securities and Exchange Board of India (Sebi) to reveal details of a dozen entities that had aided the short selling of Reliance Petroleum shares resulting in a profit of over ~500 crore and investigation reports in this case. CIC had also asked the regulator to share the file notings and other relevant records that led to the implementation of consent order mechanism in 2007.
But since the regulator is yet to share any of these details with the expiry of a 10-day deadline, the appellant has filed the caveats in anticipation of Sebi moving the court seeking a stay on the CIC orders.
A caveat is an application addressed to the registrar of the High Court mentioning the details of any matter, which is instituted or expected to be instituted, where the applicant requests that no order with regard to the said matter may be passed without giving notice to the applicant. This helps avoid any ex-parte order in any matter which the other party may try to get at the time of filling the matter in any of the courts.
"The caveats will help the applicant to put forth his side of the case before any stay is passed on the CIC orders. Usually, the CIC does not appear or challenge such applications against its orders. The caveats will ensure that the issue does not go into cold storage without any proper challenge," said a person familiar with the development.
In four separate RTI applications, the Appellant had sought a variety of information, namely, relating to the Sebi investigation into the allegations of insider trading and short sale of shares of Reliance Petroleum in 2007 by RIL.
He had also sought some information regarding the consent order cases filed by RIL and other entities for offence under the Prohibition of Fraudulent and Unfair Practices Regulations. In the third application, he had wanted to get the copies of the assets and liabilities returns filed by the chairman of Sebi. Finally, he had sought the details of all the entities involved in the short sale of shares. In all these cases, the chief public information officer of Sebi had not disclosed any information by claiming that (a) the quasi-judicial proceedings were in progress, and (b) the desired information was exempt in terms of provisions governing trade secrets and other sensitive information.
The Appellate Authority had, by and large, endorsed the stand taken by the CPIO. Of these four cases, CIC directed Sebi to provide details whereas in the case of assets and liabilities of Sebi chairman, it upheld the view taken by CPIO.