On Friday, the Securities Appellate Tribunal (SAT) set aside SEBI’s order imposing a penalty of Rs 25 crore on industrialists Mukesh Ambani, Anil Ambani and others for non-compliance with takeover norms. The case pertains to the alleged non-compliance with takeover rules by Reliance Industries in 2000.
In April 2021, the Securities and Exchange Board of India (SEBI) imposed a total fine of Rs 25 crore on Mukesh Ambani, Anil Ambani, Nita Ambani, and Tina Ambani. Anil Ambani and Tina Ambani were separated from this business in 2005. SEBI had said in its order that in 2000, the promoters of Reliance Industries and related persons had not been informed about acquiring more than a five per cent stake in the company. This order was challenged in the Appellate Tribunal on behalf of the members of the Ambani family.
In its 124-page judgement, the tribunal said, “We find that the appellant has not violated the Substantial Acquisition of Shares and Takeover Rules (SAST). The penalty has been imposed on the appellant without any legal authority. In the result, the impugned order cannot be sustained and is set aside.”
Along with this, SAT also asked SEBI to return the fine amount within four weeks. The appellants had deposited Rs 25 crore as a penalty with SEBI. SEBI, in its ruling, had said that as a result of the exercise of options on the warrants attached with the non-convertible secured redeemable debentures, the RIL promoters, along with others, acquired a 6.83 per cent stake, which was more than the five per cent limit prescribed under regulations.
No public information was given by the promoters of Reliance and their associates about the shares thus acquired. In such a situation, he was accused of violating the provisions of the Acquisition Rules.
