Regulatory body SEBI (Securities Exchange Board of India) decided not to impose any penalty for the alleged violations mainly on two grounds. One of them was concerned with an amendment. The amendment held that any incorrect disclosure of information by a listed company is punishable. It came into force prospectively from March 2019.
Moreover, the regulator mentioned its pending appeal before the Supreme Court against a Securities Appellate Tribunal order. Quarterly financial statements were submitted by RIL (Reliance Industries Ltd) to the NSE for six consecutive quarters beginning June 2007 to September 2008. However, they contained the same figures for basic as well as diluted Earnings Per Share (EPS) despite existence of share warrants, according to SEBI.
RIL had issued 12 crore warrants to its promoters on April 12, 2007. These warrants were convertible within 18 months with an exercise price of Rs 1,402 per warrant. In addition, they entitled its holders to subscribe to equivalent number of equity shares. On October 3, 2008, the board of directors allotted 12 crores equity shares of Rs 10 each to the allottees.
Furthermore, in a 39-page order, dated September 20, SEBI said the amendment with regard to furnishing false, incorrect or incomplete information, document, books, return or report, made punishable under the provisions of Section 23A of SCR Act, 1956 effected by the Finance Act, 2018 with effect from March 8, 2019 came into effect only with prospective effect.