SC declines to grant interim relief in challenge to the LIC IPO

Life Insurance Corp set to launch $8 billion IPO on March 11
Life Insurance Corporation of India (LIC) logo is seen at a metro station in Mumbai, India, January 31, 2022. Reuters/Francis Mascarenhas

New Delhi: The Supreme Court on Thursday declined to grant interim relief to petitioners challenging the amendments to LIC Act by Finance Act of 2021, which facilitated the LIC IPO.

A bench headed by Justice D.Y. Chandrachud said: "We are of the view that no case of interim relief has been made out. No interim relief granted."

The top court declined to interfere with the LIC IPO process at this juncture. A bunch of policy holders had moved the apex court alleging violation of the LIC Act.

"In matters of IPO, the court will be reluctant in granting interim relief. It is about investments", said the bench also comprising Justices Surya Kant and P.S. Narasimha.

The counsel for a petitioner said the amendments to the LIC Act, seriously affects the interest of participating policyholders and the amendments should not have been carried out through Money Bill. A counsel argued 'what is the legal character of LIC' and added that it is a mutual benefit society converted into a joint stock company.

The bench noted that the petitioners' counsel argued that the process which led to the enactment of the LIC Act was on the basis that it was a Money Bill.

The bench said that the issue raised is regarding the enactment of law as a Money Bill, and the same is already pending before the top court, therefore the case will be tagged along with the pending matter. The top court issued notice in the matter.

The counsel representing the Centre contended that the Money Bill was passed 15 months ago, and the petitioners can't come to court so late.

One of the petitioners had initially moved the Madras High Court challenging provisions of the Finance Act, 2021 and the Life Insurance Corporation (LIC) Act. The plea argued that the Acts were introduced by way of a Money Bill under Article 110 of the Constitution, even though the amendment did not fall in the category of a Money Bill.

The comments posted here/below/in the given space are not on behalf of Onmanorama. The person posting the comment will be in sole ownership of its responsibility. According to the central government's IT rules, obscene or offensive statement made against a person, religion, community or nation is a punishable offense, and legal action would be taken against people who indulge in such activities.