By IANS
New Delhi : The Supreme Court Wednesday restrained the Gujarat High Court from hearing two public interest lawsuits (PILs), allegedly filed to stall the Jan 15 launch of the country’s biggest initial public offering (IPO) by the Anil Ambani-promoted Reliance Power Ltd (RPL).
A bench of Chief Justice K.G. Balakrishnan stalled the Gujarat High Court proceedings on a petition by RPL seeking transfer, either to the Bombay High Court or the apex court, of the petitions filed against it Tuesday in Gujarat.
Appearing for RPL, senior counsel Harish Salve and Mukul Rohtagi pleaded that the filing of the petitions was meant to stall the company’s launch of the public offer.
Pointing out to the bench that the IPO is being launched to fund RPL’s ambitious power projects with a capacity of 28,000 MW, counsel contended that the PILs were “an abuse of the process of law and court and malafide”.
Salve told the bench that as per a 1994 ruling of the apex court in the case of Morgan Stanley Mutual Fund versus Kartick Das, the Gujarat High Court had no jurisdiction to entertain lawsuits against RPL owing to the simple fact that its office is located at Mumbai and Bombay High Court alone is entitled to hear them.
The RPL counsel argued that Rajkot Town/District Consumers’ Welfare Association has filed the lawsuit against RPL despite the fact that their complaints against the launch of the IPO have already been heard and grievances redressed by the Security Exchange Board of India (SEBI).
Not content with the SEBI order on the issue, they went to the Securities Appellate Tribunal (SAT) to challenge it, said counsel, adding they subsequently moved the Gujarat High Court on the same issue despite the fact SAT is seized of the matter and slated to hear the same a day before launch of the IPO.
Asserting that the petitions filed at the Gujarat High Court are “the part of a vicious and malicious campaign by a handful of a process to hold the launch of the IPO to ransom,” Salve said the malafide of the petitioner was also borne out from the fact that they moved the high court at the eleventh hour.
The counsel said the association approached the high court only Tuesday despite the fact RPL had submitted its Draft Red Herring Prospectus (DRHP) to SEBI to clear the launch of the IPO on Oct 3 last year.
Additionally, various channels associated with the launch, including media, banking and broking, have been fully activated, said the counsel, adding the firm has already been presented before hundreds of institutional investors across the globe.
The counsel apprehended that any last-minute hurdle cropping up in the way of the launch of the IPO will not merely affect the business interest of the firm but also will be a setback to its reputation.