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HC seeks details from Sebi, IDBI on petition against RPL

The Delhi High Court on Monday asked the Securities and Exchange Board of India and the Industrial Development Bank of India to furnish details whether any complaint about alleged defrauding of public treasury by Relience Petroleum Ltd were received by them, and if so, what action had been taken.

"We would like to know the reaction of Sebi and IDBI if any complaint had been referred to them and what action has been taken by them" in this regard, a bench comprising Chief Justice Arijit Passayat and Justice D K Jain said, while directing the two agencies to submit details by July 19.

The court issued the direction following a writ petition by Janata Party president Subramanian Swamy alleging that Reliance Petroleum Ltd had "defrauded" public treasury and shareholders to the tune of Rs 10 billion in connivance with officials of the finance ministry and IDBI in the promotion of public issues for Jamnagar refinery in 1993.

The RPL had issued the prospects for public issue, which included an offer of Rs 8.61 billion to the Indian public, Swamy in a public interest litigation said.

He alleged that immediately after closure of the issue, RPL had diverted interest free amounts of Rs 1.15 billion to Reliance Industries, Rs 1.75 billion to Lavanya Holdings, Rs 3.17 billion to Reliance Filament, Rs 1.35 billion to Reliance Infrastructure, Rs 470 billion to Reliance Enterprises Ltd and remaining amount to the other group companies in contravention of the Sebi rules.

These funds were interalia used to jack up the prices of shares in the group companies during 1993-94 and later loans were obtained from government institution on "artificially" enhanced share values, Swamy alleged.

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