SC rejects RIL plea against Rs 30 lakh fine over Jio-FB deal

The Supreme Court on Tuesday dismissed an appeal of Reliance Industries Ltd and two of its officials against a Securities Appellate Tribunal’s decision upholding a penalty imposed by markets regulator SEBI for not making prompt clarification to stock exchange about the Jio-Facebook deal.

“The bigger the company, the greater the responsibility. You must meticulously comply with the regulations,” a Bench comprising Chief Justice Surya Kant and Justice Joymalya Bagchi observed during the hearing.

The top court declined to interfere with the Securities Appellate Tribunal (SAT) ruling and effectively affirmed SEBI's findings that Reliance Industries Limited (RIL) and its compliance officers failed to promptly disclose unpublished price-sensitive information (UPSI) concerning the high-profile stake sale.

In June 2022, the Securities and Exchange Board of India (SEBI) imposed a penalty totalling Rs 30 lakh on RIL and two individuals, Savithri Parekh and K Sethuraman, for not making prompt clarification to the stock exchange pertaining to the Jio-Facebook deal, which was disclosed through media reports.

The SEBI penalty was upheld by the SAT on May 2, 2025.

"In our considered view, the conclusion drawn by the SEBI with respect to the violation of the 2015 regulation, whereby there is a statutory embargo on insider trading, we are satisfied that there is no case made out for interference. That apart, the issues dealt with by the SEBI and the SAT are substantially issues of fact giving rise to no substantial question of law for consideration by this court," the bench said in the order.

The top court said the SAT findings did not merit interference and moreover, no question of law was there needing adjudication.

During the hearing, the counsel for RIL said that the firm had complied with the regulations and there was no insider training or unlawful gains.

The prior selective news leaks about the Facebook-Jio deal should not be a ground to impose liability on the company, he said.

He also said there was no obligation on any listed firm to “verify, confirm or deny such market rumours” under relevant regulations.

"The moment this news came that Facebook is making such a huge investment, if it was not correct, you should have immediately denied. If everybody knows that such a huge investment is coming, the market price will rise on speculation. You are the best person to say if it is correct or not," the CJI said during the hearing.

SEBI's adjudicating officer had in June 2022 imposed the Rs 30 lakh combined penalty after concluding that RIL violated Principle 4 of Schedule A of the Prohibition of Insider Trading (PIT) Regulations.

As per Principle 4, listed companies have the obligation to make "prompt dissemination of unpublished price sensitive information that gets disclosed selectively, inadvertently or otherwise to make such information generally available”.

The capital markets regulator held that the company did not issue timely confirmations or denials in response to widespread media reports in March-April 2020 speculating on Facebook's investment in Jio Platforms.