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<p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">The Securities Appellate Tribunal (SAT) has finished hearing Reliance Industries&rsquo; appeal against the Securities and Exchange Board of India (Sebi) in an insider trading case dating back to 2007. SAT has reserved its order after hearing arguments by Janak Dwarkadas on behalf of RIL and D J Khambata for Sebi.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">Dwarkadas said Sebi cannot turn down an application without due cause, even if it is a case of insider trading. &ldquo;It says it is not consentable to begin with. because the allegations are such.&nbsp; It cannot be done on an irrational basi.&rdquo; he said. He also pointed out Sebi had not initially provided certain documents related to the case.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">Khambata argued the discretion on deciding on a consent application remains with the regulator. He said Sebi&rsquo;s not providing certain documents does not suggest prejudice unless the entity can prove how the documents would have been relevant to its position.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">Sebi has been looking into alleged insider trading involving Reliance Petroleum, which was later merged with RIL. The firm reportedly made gains of INR. 500 crore by taking positions in the stock market on the basis of price-sensitive information about the merger.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">The regulator has been investigating the case since 2008. It issued a showcause notice in 2010. RIL tried to resolve the matter through the consent mechanism, which allows companies pay a sum of money to settle the charges against them. However, Sebi turned down the consent application. Later, it also amended the consent mechanism so that serious violations such as insider-trading cannot be dealt with through the same. RIL subsequently moved the SAT, which hears appeals against Sebi, stating that it had not received access to a number of documents pertaining to the case.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">The first appeal was disposed of on 20.12.2013 after the regulator said it had already provided the required documents.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">Sebi has previously penalised Reliance for a separate case of insider trading, to the tune of INR. 11 crore. The regulator had found that a subsidiary Reliance Petroinvestments had traded in the shares of Indian Petrochemicals before its merger with RIL as well as the announcement of an interim dividend.</span></span></span></p> <p style="text-align: justify;"><span style="color:#696969"><span style="font-size:11px"><span style="font-family:arial">Source-On Request</span></span></span></p>