Kerala High Court Declines To Stay Lakshya IPO, Cites Alternate Remedy Before SAT

The Kerala High Court on Thursday declined to stay the proposed Initial Public Offering (IPO) of Learnfluence Education Limited, the company operating the Lakshya Indian Institute of Commerce coaching platform. The Court held that the former promoter challenging the issue has an alternative statutory remedy before the Securities Appellate Tribunal (SAT).

Justice Harishankar V. Menon passed the order on a writ petition filed by Adheesh Damodaran, a co-founder of Lakshya CA Campus and erstwhile promoter of Learnfluence.

Damodaran alleged that shares originally held by him had been fraudulently transferred. He further contended that the company was proceeding with its IPO on the basis of a disputed shareholding structure.

Senior Advocate Pramod Nair, appearing for Damodaran, argued that the IPO should be stayed. He submitted that the shares proposed to be offered to the public originally belonged to the petitioner and were transferred through deceitful means.

Nair also relied on a communication issued by the Assistant Commissioner of Police, District Crime Branch, Kochi City. He contended that the police investigation lent support to the allegations of fraudulent share transfers.

Opposing the plea, the company and its Managing Director submitted that the Securities and Exchange Board of India (SEBI) had already passed an order on March 11, 2026 concerning the proposed IPO.

They argued that any challenge to that approval could only be pursued under Section 15T of the SEBI Act before the Securities Appellate Tribunal.

Damodaran, however, contended that he was unable to avail himself of the appellate remedy because he had not been served with a copy of the SEBI order.

During the hearing, counsel appearing for SEBI produced the March 11 order before the Court and furnished copies to all parties. Taking note of this, the Court observed that Section 15T permits an appeal against "any order" passed by SEBI.

"However, from the perusal of the provisions of section 15, this court notices that, 'any order' issued by the SEBI is appealable thereunder," the Court observed.

After receiving a copy of the SEBI order in court, the petitioner's objection regarding the availability of the appellate remedy no longer survived. The Court held that the challenge to the approval granted for the IPO must be pursued through the statutory mechanism under the SEBI Act.

"I am of the opinion that it is for the petitioner to challenge the order dated 11-3-2026 in accordance with law," the court noted.

The court further noted that the writ petition itself sought a stay on the approval granted for the IPO. In view of the SEBI order already being in existence, it held that the petitioner must "work out his remedies" under the statutory framework.

The court consequently declined to interfere with the IPO process and left it open to Damodaran to pursue his remedy before the Securities Appellate Tribunal.

For Petitioner: Senior Advocate Pramod Nair, Advocates Nebil Nizar and Ahaan Mohan

For Respondents: Senior Advocates Joseph Kodianthara, Santhosh Mathew, Advocates K.M Jamaludheen, Latha Prabhakaran, Anjana K, Ajay V Anand, Vijay V Paul, Alphin Antony, Rojit Zachariah, P.V Uttara, Radhika Prasad, Razana, Mohammad Azif S and Ratheesh P.R, CGC