Information On Inquiry Conducted By SEBI On Alleged Insider Trading Exempted Under RTI Act: Delhi High Court

The Delhi High Court has held that information on inquiry conducted by the Securities and Exchange Board of India (SEBI) into alleged insider trading is exempted under Section 8(1)(h) of the Right to Information Act, 2005.

The Court was considering a Letters Patent Appeal seeking a direction to SEBI to provide copy of the speaking order regarding part disposal of the complaint of the Appellant as well as the status and details of the investigation on the website/portal.

The Division Bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela held, "Having noted the aforesaid narration of facts and the observations noted by the statutory authorities under the Right to Information Act, 2005 coupled with the findings of the learned Single Judge that the information sought is exempted under Section 8(1)(h) of the RTI Act, 2005, we do not find any reasons to interdict the impugned order dated 24.12.2024."

The Appellant was represented by Advocate Raghavendra Mohan Bajaj, while the Respondent was represented by Senior Advocate Venugopal.

Facts of the Case

The facts in brief were that a Complaint was filed by the Appellant seeking a detailed and thorough investigation in the matter of Offer for Sale (OFS) of equity shares of the Respondent No.3 company. Vide email sent by SEBI SCORES, the Appellant was informed about part disposal of her complaint and also forwarding of the complaint with regard to allegations of insider trading to the concerned department for necessary action. Thereafter, various emails were sent by the Appellant to SEBI seeking status regarding the ongoing investigation with respect to her complaint; however, to no avail.

The Appellant filed an Application under the Right to Information Act, 2005, to the Central Public Information Officer. The query was responded to by the CPIO. Dissatisfied by such a response, the Appellant preferred an Appeal before the First Appellate Authority, which was dismissed. The Second Appeal filed by the Appellant was also dismissed.

Later, the Writ Petition filed was also dismissed, holding that (i) the information regarding the status of her complaint was duly provided to her; and (ii) the information regarding internal investigation is exempted under Section 8(1)(h) of the RTI Act. Aggrieved thereof, the present appeal was filed.

Reasoning By Court 

The Court was of the opinion that the reasons provided by authorities under the RTI Act  cumulatively are sufficient not to disclose the information sought by the Appellant.

"....With respect to the ongoing investigation, if at all, the statutory authorities have also given reasons as to why and under what circumstances the disclosure of such information may impede the investigation process in terms of Section 8(1)(h) of the RTI Act and also the fact that such disclosure may not only affect confidentiality of examination/investigation but may also affect evidence collection and result in unnecessary harm to third parties...", the Court observed.

The Appeal was accordingly dismissed.

Cause Title: Srishti Rustagi vs. Securities and Exchange Board of India (SEBI) & Ors. (2025:DHC:8242-DB)

Appearances:

Appellant- Advocate Raghavendra Mohan Bajaj

Respondent- Senior Advocate Venugopal, Advocates Ashish Aggarwal, Rahul Malik, Shivangi Shokeen, Lisha Arora and Himanshu Singh

Click here to read/ download Order