In a significant development in the ongoing ICICI Securities delisting controversy, the national company law tribunal (NCLT) in Ahmedabad has ordered ICICI Bank to disclose the SEBI Exemption Order granted on 20 June 2023. This decision, made on 19 September 2024, marks the second judicial forum, after the Bombay High Court, to demand transparency regarding this crucial document.
The NCLT Ahmedabad bench, comprising member (judicial) Shammi Khan and member (technical) Sameer Kakkar, directed ICICI Bank to file an additional affidavit including the exemption order within 10 days. This directive came in response to concerns raised by lawyers representing Bengaluru-based portfolio manager Manu Rishi Guptha, who has challenged the delisting of ICICI Securities Ltd.
The lawyers questioned ICICI Bank's transparency, accusing the Bank of suppressing the exemption order and failing to maintain openness in its actions. The NCLT had previously reserved its judgement on 22 August 2024, but instead of delivering a ruling, it listed the case for clarification on 19 September 2024, resulting in this latest directive.
The court order also revealed that the SEBI-approved scheme dated 28 November 2023, was not placed on record. Additionally, ICICI Bank had not filed an affidavit of undertaking as required by the competition commission of India's reply dated 9 May 2024. The NCLT has instructed its registry to issue a certified copy of the CCI's reply to ICICI Bank within three days.
The case is now rescheduled for consideration on 3 October 2024, following the submission of the additional affidavit by ICICI Bank. The ICICI Securities delisting saga has grown increasingly complex and multi-faceted since its inception. What began as objections from minority shareholders has evolved into a legal battle spanning multiple forums, including the NCLT in Mumbai and Ahmedabad, the Bombay High Court, and the national company law appellate tribunal (NCLAT).
Concurrently, the Bombay High Court on 3 September 2024 made a significant ruling in this ongoing controversy, allowing petitioner Aruna Vinod Modi to amend her writ petition challenging SEBI's exemption to ICICI Securities. The court, comprising justices KR Shriram and Jitendra Jain, granted leave to amend the petition based on new information that emerged after the initial filing. The court set a timeline for the amended petition to be served within one week, with respondents given until 1 October 2024, to file replies. Importantly, once the amended petition is filed, the previously confidential SEBI exemption letter will become part of the public domain, potentially shedding more light on SEBI's rationale for granting the exemption.
The case has progressed from initial concerns about the delisting process and share valuation to encompass broader issues of corporate governance, regulatory compliance, and transparency. The demand for disclosure of the SEBI exemption order by both the Bombay High Court and now the NCLT Ahmedabad underscores the growing scrutiny of the regulatory approvals underlying the delisting process.
As the case continues to unfold across various legal venues, it highlights the intricate interplay between corporate actions, regulatory oversight, and shareholder rights in India's evolving corporate landscape. The outcomes of these proceedings could potentially set significant precedents for future delisting processes and corporate governance standards in the country.
You may also want to read…
May be, Kochhar has trained the whole lot in doing various kind of financial juggleries.