RTI applicant moves Bombay High Court on RIL Insider trading case

Files caveats to prevent any ex-parte stay against CIC order to reveal identities of dozen RIL associates

The 2007 Reliance Industries (RIL) Insider trading case has reached the Bombay High Court with the Bangalore-based lawyer seeking information under Right To Information (RTI) Act filing caveats against any potential appeal by market regulator Securities and Exchange Board of India (Sebi) against a recent order by an apex RTI body. 

On November 6, Central Information Commission (CIC) had directed Sebi to reveal details of a dozen entities that had aided the short selling of Reliance Petroleum shares resulting in a profit of over Rs 500 crore and investigation reports in this case. The 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 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 in to 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 the Reliance Petroleum in 2007 by the Reliance Industries Ltd.

He had also sought some information regarding the consent order cases filed by the Reliance Industries Ltd and other entities for offence under 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 quasijudicial 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, the CIC directed Sebi to give details in three whereas in the case of assets and liabilities of Sebi chairman it upheld the view taken by CPIO.