JUDGMENT :

Nitin Jamdar, J.

1. Rule. Rule made returnable forthwith. Heard finally by consent of parties.

2. The Petitioner, JK Paper Limited, requested the Respondent- Securities and Exchange Board of India for a personal hearing regarding exemption application filed by it under a regulation governing employee stock options. The Board of SEBI refused the request for personal hearing and permitted additional written submissions. Petitioner has filed this petition to direct the Board to grant a personal hearing.

3. The question therefore is: whether the Board is obliged to grant a personal hearing to the petitioner while considering an exemption application under the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014. The answer is-No. The facts and the reasons for this conclusion are as follows.

4. The Petitioner- JK Paper Limited is a public limited company. The Petitioner manufactures and supplies paper and board. The Respondent, Securities and Exchange Board of India, SEBI, is established under the Securities and Exchange Board of India Act, 1992.

5. SEBI, in the year 1999, had framed "Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999" which provided for the stock-based incentive schemes to employees. On 28 October 2014, SEBI notified Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, ("Regulations of 2014"). SEBI has framed the Regulations of 2014 in the exercise of the power conferred by sections 11, 11A and 30 of the Act of 1992 read with section 62 of the Companies Act of 2013 and rule 12 of Companies (Share Capital and Debentures) Rules, 2014. The Regulations govern the following schemes: (a) employee stock option schemes; (b) employee stock purchase schemes; (c)stock appreciation rights schemes; (d) general employee benefits schemes; and (e)retirement benefit schemes consequent upon which the existing guidelines have been repealed. The Regulations shall apply to those companies whose shares are listed on any recognised stock exchange in India, and which fulfils the following: (i) has a scheme for the direct or indirect benefit of employees; (ii )involves dealing in or subscribing to or purchasing securities of the company, directly or indirectly; and which has a scheme set up by the company or any other company in its group; the scheme is funded or guaranteed by the company or any other company in its group; the scheme is controlled or managed by the company or any other company in its group. The Regulations of 2014 lay down various regulatory measures regarding such a scheme. The object of the Regulations of 2014 is to check and prevent manipulation of share prices in the larger interest of the investors.

6. The Petitioner, in January 2004, formed an employee welfare trust named JK Paper Welfare Trust. Around ninety seven percent of its assets are shares of the Petitioner and around 4.73% of its share capital. The Trust administers Continuity Facility Assistance Scheme; Medical Assistance Scheme; Education Scholarship Scheme; and Prize Scheme for Sports.

7. On 7 May 2018, the Petitioner sought clarification regarding the Regulations of 2014. By letter dated 29 June 2018, SEBI provided guidance to the Petitioner. SEBI informed that the Regulations of 2014 apply to the Petitioner.

8. On 24 October 2019, the Petitioner applied seeking relaxation from the applicability of Regulations under the Regulation 29 of the Regulations of 2014, the SEBI is empowered to grant relaxation for the strict compliance of the Regulations.. Relying upon Regulation 29, the Petitioner sought exemption from the strict compliance of Regulations 1(3), 1(4), 3(1), 26(2) and 31(2)(b)(i) and (ii). Reasons for exemption were in the application.

9. By communication dated 3 February 2020, the SEBI rejected the Petitioner’s request for exemption. The communication did not spell out any reasons for rejection. The Pe