The Supreme Court on Thursday refused to stay the ongoing process of the initial public offering (IPO) of Life Insurance Corporation of India (LIC).
This will pave way for the completion of share allotment process, without any hassles.
However, the apex court agreed to hear the challenge to the dilution of the government’s shares and petitions against LIC’s IPO.
A Bench comprising Justice DY Chandrachud, Justice Surya Kant and Justice PS Narasimha observed that no case for grant of interim relief was made out.
The Centre or LIC needs to reply on the matter within eight weeks and a response from petitioners four weeks after that, it said.
These proceedings will be tagged with issues before the Constitutional Bench.
The Bench further issued notice in the bail petition of Jitender Narain Tyagi. The matter was listed for hearing on Tuesday.
During the hearing today, Senior Advocate Indira Jaising, along with Advocate Prasanna S, appeared for the petitioner.
They said, “The petitioners have filed the case in the Supreme Court to issue a writ of mandamus, to declare Section 5 of the Life Insurance Corporation Act, 1956 (as amended by the Life Insurance Corporation (Amendment) Act, 2011) to be void and inoperative to the extent the capital of the corporation is characterised as ‘equity capital’, and to declare Sections 130, 131, 134, and 140 of the Finance Act, 2021 and Sections 4,5,24 ad 28 of the Life Insurance Corporation Act, 1956 (as amended by the Finance Act, 2021) to be void and inoperative for being ultra vires Articles 14 read with Article 300A of the Constitution.
“The petitioners challenged the legality of the government’s move to pass the decision to launch the LIC’s IPO through a Money bill. The petitioners also sought that Part III of the Chapter VI of the Finance Act, 2021 be declared void ab initio for the certification of the Finance Bill, 2021 as a Money Bill to be in violation of and ultra vires Article 110 of the Constitution,” they added.
The petition also sought that both the government and the insurer to issue all necessary communications to regulators, including the Sebi, IRDAI and the general public immediately that the LIC IPO is revoked in view of the SC orders.
Appearing for the Central government, Additional Solicitor General of India Venkataraman said this was one of the biggest IPOs in the history of India.
More than 73 lakh applicants were involved and 22.13 crores shares have been sold at premium of Rs 939 per share.
He submitted that the bill which eventually resulted in Finance Act 2021, was passed on March 28, 2021, nearly 15 months ago.
He further contended that the plea under Article 32 has been instituted on May 9 2022, the date on which LIC IPO stands closed. Objecting to the grant of interim relief, ASG submitted that Sec 28 of LIC ACT as originally Act did not confer any contractual right to Participating policy holders on the quantum.