2024-09-22 18:32:41 :
Linde India has moved the Supreme Court challenging the Securities Appellate Tribunal (SAT) order dismissing the company’s appeal against a valuation exercise directed by the Securities and Exchange Board of India, a lawyer aware of the development said.
The appeal relates to Linde’s related-party transactions.
Unhappy with the court order, Lind has appealed to the Supreme Court. “They (Lind) are seeking a stay on the validity and enforcement of the SAT order,” said the lawyer, who did not want to be named, without giving further details.
The case will be heard on Monday
According to court documents, a bench headed by Chief Justice DY Chandrachud and Justices JB Pardiwala and Manoj Mishra will hear the case on Monday.
On Friday, the SAT bench headed by Justices PS Dinesh Kumar and Dheeraj Bhatnagar directed the Securities and Exchange Board of India to “issue necessary orders/clarifications providing for compliance of confidentiality norms of Unpublished Price Sensitive Information (UPSI) by NSE and its appointed valuers.”
The court also clarified that the Securities and Exchange Board of India (Sebi) should keep confidential the information disclosed for the valuation exercise and would accord due protection to UPSI under Sebi rules.
On April 29, the Securities and Exchange Board of India said in its interim order that Linde India entered into material related-party transactions that appeared to be material on the surface without obtaining prior approval from shareholders. The company did not provide any valuation to the board while taking the decision to award future business to related parties.
The case involves various transactions and agreements entered into by Linde India with Praxair India and Linde South Asia Services, both of which are affiliates of the company.
Market regulator Securities and Exchange Board (Sebi) has asked NSE to appoint a registered valuer to carry out valuation of business relinquished and acquired (including by way of geographical allocation) in the joint venture (JV) and shareholders agreement (SHA) between Linde India and Praxair India, which led to the formation of Linde South Asia Services.
Venkatesh Dhond, senior legal counsel at Linde India, argued that the valuation was not urgent and the valuer had asked for data from 2016, which was not easily available.
Dhond further said that since the main appeal is scheduled for October 15, the valuation exercise will be meaningless if Linde’s appeal is successful. He also expressed concerns about possible leakage from UPSI as the company is required to share sensitive information with third-party valuers, which may have a negative impact on investor confidence and securities markets.
Responding to these arguments, Darius Khambata, senior counsel representing SEBI, maintained that valuation is an integral part of the regulator’s investigation into whether related-party transactions require shareholder approval.
He argued that stopping the valuation would hamper SEBI’s fact-finding process and stressed that the move would not harm the interests of the company.
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