Kirloskar firms drag Sebi to court over disclosure rules

Regulation mandates disclosure of private agreements by promoters, directors, stakeholders

- Neha Joshi & Priyanka Gawande

A dramatic escalation of the long-running Kirloskar family dispute, five listed Kirloskar Group companies have moved the Bombay High Court challenging the constitutional validity of a regulation that mandates disclosure of private agreements by promoters, directors and other stakeholders.

Kirloskar Oil Engines Ltd (KOEL), Kirloskar Ferrous Industries Ltd, Kirloskar Pneumatic Company Ltd, Kirloskar Industries Ltd and GG Dandekar Properties Ltd have individually filed writ petitions challenging regulations laid down by the Securities and Exchange Board of India (Sebi). Mint has seen a copy of the petitions.

The companies said Sebi's disclosure rules were "manifestly arbitrary", "disproportionate" and "impermissibly retrospective". They argued that the regulator had overstepped its mandate by effectively compelling listed companies to treat third-party agreements—including those they may not have signed or ratified—as binding and material.