Court Finds Lack of Instructions from Respondents Justifies Interim Relief
In a significant development, the Delhi High Court has stayed the enforcement of penalties imposed on LinkedIn Technology Information Pvt. Ltd. and its directors for purported violations of the Companies Act, 2013. The penalties were related to alleged non-compliance with statutory obligations concerning the declaration and disclosure of beneficial interest in shares as per Sections 89 and 90 of the Act.
The case was heard by Justice Anish Dayal, who issued an interim order on May 15, 2026, staying the operation of the impugned orders until the next hearing scheduled for October 6, 2026. The petitioners, represented by Senior Advocate Mr. Gopal Subramanium, challenged the penalties, arguing that the original declarations filed on January 29, 2024, were in compliance with the statutory requirements.
The Registrar of Companies (ROC), however, had relied on disclosures made to the United States Securities and Exchange Commission (SEC), which the petitioners contended were distinct from Indian statutory provisions. The court noted the absence of instructions from the respondents, represented by Senior Panel Counsel Mr. Vikrant Nilesh Goyal, as a reason for granting interim relief.
The matter gained complexity as the ROC's order also included all petitioners despite claims that not all were required to make disclosures under the relevant sections. The appeal against the ROC's decision was dismissed by the Regional Director, Northern Region, leading to the current proceedings in the High Court.
The judgment highlights the ongoing challenges multinational corporations face in navigating different regulatory frameworks and the importance of clear statutory guidelines. The court's decision to stay the penalties provides temporary relief to LinkedIn Technology while the case continues to unfold.
Bottom line:-
Companies Act, 2013 - Penalty imposed under Sections 89 and 90 for alleged non-compliance with declarations and disclosures regarding beneficial interest in shares - Operation of impugned orders stayed by the Court due to lack of instructions from respondents.
Statutory provision(s): Companies Act, 2013 Sections 89, 90
LinkedIn Technology Information Pvt. Ltd. v. Union of India, (Delhi) : Law Finder Doc id # 2903675
