SEBI moves Supreme Court against NDTV, promoters, promoters

Capital markets regulator Securities and Exchange Board of India SEBI has approached the Supreme Court against media house New Delhi Television Limited NDTV and its founder promoters Dr Prannoy Roy and Radhika Roy and the promoter entity RRPR Holding Private Limited. The SEBI approached the top court with a Securities Appellate Tribunal SAT order which discovered that the Roys and RRPR Holding did not engage in an indirect transfer of control of the media house via loan arrangements with Vishwapradhan Commercial Private Limited VCPL in 2009 -- 10.

The SAT reduced penalties on NDTV, Dr Prannoy Roy, Radhika Roy and RRPR Holding from 25 crore to 5 crore in a case of non- disclosure of a loan agreement, citing the penalties as high, execessive and disproportionate. The fines on NDTV were slashed from Rs 5 crore to Rs 10 lakh for failing to disclose loan agreements with VCPL.

The combined reading of the agreement, call option agreements, warrant conversion option and purchase option does not in any way lead to a conclusion of VCPL acquiring indirect control over NDTV, according to the order accessed by news agency PTI. The direction to VCPL to make an open offer in terms of SAST Regulations does not arise. According to the order, "The concealment of the loan agreement which gave de facto control to VCPL was concealed from the shareholders and, therefore, such arrangement deployed by the appellants to transfer their substantial stake in NDTV was fraudulent and violative of the PFUTP Regulations, as we have already held that there was no direct or indirect control over NDTV by VCPL." The tribunal had set aside a June 2018 SEBI order that directed VCPL to make an open offer to NDTV shareholders. At the time, the SEBI directed VCPL to make an open offer. In the same period next year, SEBI barred the Roys from accessing the securities market for a period of two years and barred them from holding or occupying any position as a director or key managerial personnel in NDTV for two years or any other listed company for a year.

The fines on Roys and RRPR Holding were collected in December 2020, and the SEBI levied around 25 crore. The markets regulators also imposed a penalty of 1 crore on Dr Prannoy Roy and Radhika Roy.

Adani Group has acquired a 29.18 per cent stake in NDTV, a port-to-power conglomerate, which has a 99.99 per cent stake in RRPR Holding.