Reliance Industries today said its pending plea before the SAT against Sebi is not related to any insider-trading, but challenges the regulator's arbitrary decision to shut the consent mechanism window on it.
The Securities Appellate Tribunal (SAT) yesterday concluded a near four-year hearing on RIL's plea against market regulator Sebi's allegations of the company violating the FUTP (fraudulent and unfair trade practices) norms in its dealings on the shares of one of its arm Reliance Petroleum in 2007. SAT will pronounce its order on Monday.
"Reliance Industries has filed an appeal (appeal No 1 of 2013) before the SAT challenging the order dated January 2, 2013 passed by the Securities & Exchange Board rejecting RIL's consent application. The issue before Sebi in the above matter does not relate to "insider trading" as has been reported," Reliance Industries Ltd (RIL) said in a statement.
It further said its primary submission in the appeal is that rejection of its consent application by Sebi is contrary to the principles of natural justice (without giving an opportunity to RIL of being heard) and in a completely arbitrary, unfair, unreasonable manner.
The consent settlement mechanism as they presently exist provided that all decisions on consent applications should be made only after following the due process of law and after giving the applicants an opportunity for putting forth their submissions, it said.
However, in this case, the due process of law was not followed and an arbitrary and unreasonable rejection of the consent application was passed by Sebi on January 2, 2013, it alleged.
Rejecting media reports that the case pertains to alleged insider trading violation, RIL said the said show-cause notice dated December 16, 2010 from the Sebi alleged that RIL and certain other entities have contravened the provisions of Sebi Act of 1992, the Securities Contracts (Regulation) Act, 1956 and the Sebi (contravention of Fraudulent and Unfair Trade Practices Regulations), 2003.
"The show cause notice nowhere mentioned or alleged contravention of any insider-trading regulations by RIL or other entities. The said notice is pending adjudication and the alleged offence and penalty have not been confirmed till date," RIL said.
Following the show-cause notice, RIL tired to correspond with Sebi, requesting it to provide the copies of the documents relied upon by the regulator while issuing the notice, but without success.
