Linde India has moved the Supreme Court challenging the Securities Appellate Tribunal’s (SAT) order that rejected the company’s appeal against a Sebi-directed valuation exercise, said a counsel aware of the matter.
The appeal is in connection with Linde’s related-party transactions.
Aggrieved by the tribunal’s order, Linde has approached the top court. “They (Linde) are seeking a stay on the effect and operation of the SAT order," said the counsel on the condition of anonymity, without divulging further details.
A bench led by Chief Justice D.Y. Chandrachud along with justices J.B. Pardiwala and Manoj Mishra will hear the matter on Monday, according to a court filing.
On Friday, a SAT bench led by justices P.S. Dinesh Kumar and Dheeraj Bhatnagar directed the Sebi "to issue necessary order/clarification that the NSE and the valuer appointed by NSE shall be bound by the unpublished price-sensitive information (UPSI) confidentiality norms.”
The tribunal also clarified that information to be divulged for valuation exercise shall be kept confidential by the Securities and Exchange Board of India (Sebi) and the UPSI will be given due protection in accordance with Sebi rules.
On 29 April, Sebi in its interim order said that Linde India was carrying out material related party transactions—which on the surface seem significant—without first obtaining shareholder permission. The company did not make any valuation available to its board when the decision to award future businesses to related party was made.
The matter is in regard to various transactions and agreements that Linde India entered into with Praxair India and Linde South Asia Services, both of which are related parties of the company.
Market regulator Sebi had asked NSE to appoint a registered valuer to carry out a valuation of the business foregone and received, including by way of geographic allocation, in terms of the joint venture (JV) and shareholders agreement (SHA) between Linde India and Praxair India that led to the formation of Linde South Asia Services.
Venkatesh Dhond, senior counsel for Linde India, had argued that there was no urgency for the valuation and that the valuer had requested data dating back to 2016, which was not readily accessible.
Dhond further said that with the main appeal scheduled for hearing on 15 October, the valuation exercise would be futile if Linde’s appeal were to succeed. He also raised concerns about potential UPSI leaks, as the company had been asked to share sensitive information with the valuer, a third party, which could negatively affect investor confidence and the securities market.
Countering these arguments, senior counsel Darius Khambata, representing Sebi, maintained that the valuation is an integral part of the regulator's investigation into whether shareholder approval was required for the related party transactions.
He argued that halting the valuation would hinder Sebi’s fact-finding process and emphasized that the exercise would not prejudice the company.
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