In its recent order, the market regulator noted that the directives given in the interim order cum show cause notice dated June 19, 2024, were preventive and remedial in nature, fulfilling their intent following the conclusion of the open offer, after control of REL passed to the Burman Group in February 2025.
The proceedings arose from an interim order-cum-show cause notice issued on June 19, 2024, alleging that REL and its board had not cooperated during the open offer by failing to facilitate necessary statutory approvals from regulators, including the Reserve Bank of India.
SEBI had alleged breaches of takeover and listing regulations by both the company and its directors.
SEBI highlighted that the Burman Group announced an open offer in September 2023, as its potential acquisition would elevate its stake in REL beyond 25%. The offer aimed for up to 26% of the expanded voting share capital.
The market regulator observed that the open offer process was successfully completed, the post-offer advertisement was released on February 18, 2025, and the acquirers later took control of the company.
While independent directors claimed reliance on representations made by Rashmi Saluja and stated they were not involved in the daily operations of the company, according to the order.
However, Saluja and Hamid Ahmed argued that the Committee of Independent Directors (CoID) operated independently and secured legal opinions from credible sources indicating that the open offer was not advantageous to REL and its shareholders, as stated in the order.
“Although various claims and assertions have been presented by the parties, I find that they do not necessitate resolution at this point, as the principal matter prompting the proceedings has already been addressed,” stated SEBI’s Quasi-Judicial Authority Biju S in the order.
Citing previous rulings by the Securities Appellate Tribunal, the regulator reaffirmed that the powers vested in Sections 11 and 11B of the SEBI Act are preventive and remedial, not punitive. Given that the alleged irregularity has been rectified and corrective actions taken, no additional directives were deemed necessary, it concluded.
