The Ministry of Corporate Affairs (MCA) has asked the Securities and Exchange Board of India (Sebi) for details of its investigation pertaining to Reliance Industries Ltd (RIL). The market regulator had acted on a complaint that RIL had allegedly routed funds to dummy companies to buy its own shares nine years ago.
The ministry’s response came after Sebi, in a letter on December 1, wanted MCA to take appropriate action on the alleged routing of money from RIL and erstwhile Reliance Petroleum Ltd (RPL) to 34 private companies to enable them to subscribe to RIL’s equity shares. Sebi’s recommendation was based on the advice given by Justice B N Srikrishna on the matter.
Minister for Corporate Affairs Salman Khurshid said the government had taken the Sebi letter seriously. “Sebi’s letter has to be taken seriously… The government does not want to anticipate anything. If Sebi has taken nine years, let us take at least nine days,” the minister told PTI.
MCA will go through the documentary evidence provided by Sebi before taking a decision. Officials did not rule out the possibility of handing over the matter to the Registrar of Companies (RoC).
Sebi was probing a complaint by S Gurumurthy of Swadeshi Jagran Manch, alleging that RIL and its investors lost at least Rs 2,700 crore in issuance of shares at a much lower price than what was allocated to the state-owned UTI.
After taking the opinion of retired Supreme Court Justice B N Srikrishna on its own investigation report, Sebi asked the ministry to take “appropriate action” against RIL for sale of 120 million shares, representing over 11 per cent of total equity, through this route.
“If anybody tries to do a post-mortem by digging old graves, then we will rather focus on the work forward than engage in post-mortem,” Khurshid said, adding that RIL had been demerged since then.
The Reliance empire was divided in 2005 as part of a settlement between the warring Ambani brothers Mukesh and Anil and the case relates to the time when father Dhirubhai was at the helm of affairs.
“I don’t want to anticipate or say something... This is not a policy decision. There are officials to look after these things,” the minister said, when asked about allegations that the sale of 120 million shares was done for the benefit of promoters.
