SEBI’s Failure to Provide Docs Upheld By SC Keeps Petitioner’s Rights Open For Future Action In Light of HC’s Finality

  • Blog|News|Company Law|
  • 2 Min Read
  • By Taxmann
  • |
  • Last Updated on 6 December, 2023

Minority Shareholder

Case Details: Ashok Dayabhai Shah v. Securities and Exchange Board of India - [2023] 157 85 (Bombay)

Judiciary and Counsel Details

    • G.S. Kulkarni & Jitendra Jain, JJ.
    • Ms Aarti RaghavanVikram RaghaniPulkit SukhramaniMs Vidhi JhawarDeepank AnandShourya Tanay, Advs. Gaurav Joshi, Sr. Adv. & Ms Garima Mehrotra, Adv. for the Petitioner. & Others.
    • J.J. Bhatt, Sr. Adv. Mihir ModyArnav MisraVishal KanadeAmeya GokhaleVaibhav SinghMs Radhika Indapurkar Manas Kotak for the Respondent. & Others.

Facts of the Case

In the instant case, the petitioners-minority shareholders of a company submitted grievances to the SEBI, citing breaches of minimum public sharing requirements and significant lapses in the disclosure of the promoter’s shareholdings in the company.

Consequently, the investigation was done by the SEBI into affairs of the company and a show cause notice was also issued to respondents/majority shareholders of the company.

The respondents moved an application for settlement of said show cause notice. Later on, the SEBI passed a settlement order. However, the settlement was revoked by the SEBI due to failure in compliance with the settlement order.

Since the investigation report or other relevant documents reflect that the said notice was not supplied to the petitioners, the instant writ petition was filed by the petitioner praying a direction to SEBI to provide documents to petitioners as prayed.

Subsequently, the respondents submitted that the plea of petitioners for documents to be furnished to petitioners and orders of instant Court was rendered inconsequential in view of the settlement order itself being revoked by SEBI.

Further, it was also noted that not providing such documents, merely on grounds of subsequent development that settlement orders now stand revoked, would completely be an untenable proposition and contrary to said orders as confirmed by the Supreme Court.

High Court Held

The High Court observed that the SEBI is required to holistically consider the order of the instant Court which has attained finality as such order considers substantive rights of petitioners, who are shareholders of the company. Further, the High Court held that the reliefs prayed were to be kept open to be agitated by petitioners in the context of the decision of SEBI on show cause notice.

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied