A bench comprising Justices B.V. Nagarathna, R. Mahadevan and D.K. Upadhyay disposed of the writ petition, observing that there is no existing legal or regulatory framework requiring such information to be made public. Consequently, the court declined to grant the relief sought by Moitra. However, it allowed her to approach the Central Government and SEBI regarding the grievances raised in her petition.
The bench, headed by Justice Nagarathna, said that in the absence of a legal framework or rules requiring the complete public disclosure of ultimate beneficial ownership information, the Supreme Court could not issue a writ of mandamus under Article 32 of the Constitution directing such disclosure.
“In the absence of any such framework, this Court cannot exercise its discretion to issue a writ of mandamus directing the respondents (authorities) to make such information fully public,” the Supreme Court said.
During the hearing, advocate Prashant Bhushan, appearing for Moitra, argued that substantial investments were being made in Indian companies through foreign entities, while the identities of the actual investors remained unknown. He contended that the lack of transparency raised concerns about possible violations of SEBI regulations and the potential manipulation of the stock market by entities investing large sums of money.
Bhushan also submitted that several countries mandate the public disclosure of beneficial ownership information. The bench, however, questioned whether the apex court could issue such a direction when no policy existed requiring the proposed disclosures.
“If there is a policy under which public disclosure is mandatory and you seek a mandamus to enforce it, that is a different matter. But if no policy exists, can we issue such an order?” the court observed.
Solicitor General Tushar Mehta opposed the petition, arguing that the petitioner's objective was to ensure that foreign investment did not come into the country. Responding to this contention, Bhushan maintained that disclosing the ultimate beneficial owners would not harm legitimate investments.
In its order, the Supreme Court noted that details of investments made by AIFs and FPIs were being provided to SEBI or custodians, enabling regulatory oversight. However, the court clarified that no existing legal framework makes it mandatory to publicly disclose entity-wise investments in the manner sought by the petitioner.
The ruling leaves the question of mandatory public disclosure of ultimate beneficial ownership and investment portfolios to the existing regulatory framework, while allowing Moitra to take her concerns to the Central Government and SEBI.
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