The Supreme Court of India has dismissed the appeal filed by Reliance Industries Limited and its compliance officers against a penalty imposed by the Securities Appellate Tribunal in connection with the delayed disclosure of the investment by Meta Platforms in Jio Platforms. The penalty, amounting to ₹ 30 lakh, was originally imposed by the securities regulator on the company and its two compliance officers for violations relating to nondisclosure of unpublished price-sensitive information and failure to adhere to listing obligations.
Under the relevant insider-trading regulations and listing obligations, companies are required to promptly disseminate any price-sensitive information that could affect investors. In March 2020, a major global media report broke that Meta was nearing a deal to invest in Jio Platforms. This triggered a substantial surge in the company’s share price. Despite the widespread media coverage and market impact, the formal disclosure to stock exchanges was made only in April 2020, several weeks later, after the investment deal documentation was executed. The delay in formal disclosure formed the basis for the regulator’s finding that Reliance had failed in its statutory duty to make timely disclosures once material information was in the public domain.
The securities regulator’s view was that once credible reports emerged — especially involving a multinational investment and accompanied by a significant share-price reaction — the company had an obligation to at least confirm or deny the rumours promptly. Confidentiality agreements or ongoing internal negotiations did not absolve it from this regulatory duty. According to the regulator, silence in the face of credible leaks contributed to information asymmetry and could disadvantage investors.
When this decision was challenged before the securities appeal tribunal, the tribunal upheld the regulator’s order. It found that the company and its officers had indeed violated the requirement to disclose price-sensitive information in a timely manner. Accordingly, the penalty of ₹ 30 lakh stood confirmed.
Reliance Industries then moved the Supreme Court, arguing that the obligation to disclose should arise only once the deal was final and the agreement binding. The company contended that until the deal was formalised, the matter was speculative. It argued that media reports did not automatically amount to unpublished price-sensitive information requiring mandatory disclosure. The company also pointed out that there was no insider trading or unlawful gain involved, and that the formal disclosure after execution of the agreement complied with regulatory obligations.
However, the Supreme Court rejected these arguments. The Court observed that the moment credible news broke about a major investment — one that could materially affect investor decisions — the information qualified as unpublished price-sensitive information. The Court remarked that for a company of Reliance’s stature, silence under such circumstances was not acceptable. The bigger the company, the greater the responsibility. The Court noted that the company was perfectly positioned to either confirm or deny the reports, and its failure to issue an immediate public statement reflected a breach of regulatory duty.
The Court held that even if the deal had not been finalised at the time of the news leak, the status of the discussions and the looming investment nevertheless constituted price-sensitive information. A public statement acknowledging that the deal was under discussion would have sufficed; claiming confidentiality did not excuse nondisclosure. By choosing neither to confirm nor deny, the company had failed to ensure that the information became generally available, thereby violating its obligations under insider-trading and listing norms.
The Supreme Court found no substantial question of law warranting interference with the factual findings of the regulator or the tribunal. Since the case turned on fact — whether there was delayed disclosure and hence a breach — it declined to disturb the earlier orders. Consequently, the appeal was dismissed, and the penalty remains in force.
By this decision, the Court reinforced the principle that listed companies must proactively ensure transparency and prompt disclosure of material developments. The ruling underscores that when a credible leak or media reports signal a significant corporate transaction, the duty to inform investors arises immediately, regardless of whether the deal has been formally executed. The judgment serves as a clear precedent for compliance with disclosure obligations, reinforcing market integrity and investor protection.
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