SAT sets aside Sebi's order against Linde India in related party transactions case

The Securities Appellate Tribunal (SAT) has set aside a Sebi order against Linde India in a case of related party transactions.

In addition, the appellate tribunal has asked the company to appear before the Sebi on May 27 for inspection of documents, and then file its reply within one week.In its order on Thursday, SAT said, ”It would not be just and appropriate to continue the impugned interim ex-parte order any further keeping in view that the appellant (Linde India) has been directed to file reply within 21 days and Sebi has made a statement before us to pass orders within 30 days from the date of conclusion of hearing and in the event of any adverse order, Sebi is enjoined with all powers to pass appropriate directions, including an order of disgorgement”.

The matter is related to various transactions and agreements by Linde India Ltd (LIL) with its related parties Praxair India Pvt Ltd (PIPL) and Linde South Asia Services Pvt Ltd (LSASPL).The latest ruling came after the company approached the tribunal against an order passed by Sebi on April 29 that had directed the National Stock Exchange (NSE) to designate a valuer to conduct the valuation of related party transactions between Linde India and Praxair India, following complaints by shareholders.

The interim order was passed on the premise that the company had executed related party transactions without obtaining prior approval from the shareholders.Sebi, in its interim order, noted that Linde India was executing related party transactions, which prima facie appear to be material, without taking shareholder approval.