Bombay High Court, on Thursday, directed stock market regulator Sebi to “expeditiously” look into the allegations made against Anil Ambani group firm Reliance Power Ltd (RPL), which plans to go for an initial public offering to raise funds from the bourses.

The court’s order came on a PIL, which alleged that RPL was a “shell” company, and while preparing to launch the IPO, Ambani was evading a legal provision that requires him to contribute Rs 9,000 crore as “Promoter’s contribution.”

The PIL filed by Rajkot Shahar Jilla Grahak Suraksha Mandal, was disposed by the court, with directions to Sebi.

A division bench of Chief Justice Swatanter Kumar and Dhananjay Chandrachud said as the petitioners had already approached Sebi, the court need not pass any further order. “We will only direct Sebi and company law board to dispose of your representations expeditiously,” it said. The petitioners’ lawyer K T Tulsi alleged that capital worth Rs 2,000 crore and some lucrative power projects were diverted from Reliance Energy to RPL, which was an attempt to “denude” REL. The petitioners claim to be holding shares of REL.

The decision

Promoters of RPL were misusing Sebi’s Disclosure and Investors’ Protection Guidelines, 2000, he alleged. K T Tulsi’s prayer was that High Court direct Sebi as well as Union Government to investigate this “Fraud of Rs 9,000 crore” and also direct Sebi not to schedule RPL’s proposed IPO till representations made by petitioners to it were decided.

RPL had submitted its draft red herring prospectus for the IPO to the market regulator on October 3 and is awaiting the market regulator’s clearance to go ahead with the IPO.