Supreme Court Refuses To Interfere With Delhi High Court Order Quashing SFIO Probe Into Moser Baer

The Supreme Court on Tuesday declined to interfere with the Delhi High Court's decision quashing a Serious Fraud Investigation Office probe into Moser Baer India Limited, holding that the High Court committed no error in setting aside the government's order directing the investigation.

A Division Bench of Justice Prashant Kumar Mishra and Justice N.V. Anjaria dismissed the Special Leave Petition filed by Karanartham Viramah Foundation.

After hearing the petitioner, the Bench said it was “not inclined to entertain this Special Leave Petition” and dismissed it accordingly.

The case before the Supreme Court traced back to a September 5, 2024 order of the Ministry of Corporate Affairs issued under Section 212(1)(c) of the Companies Act, 2013. Through that order, the government had asked the Serious Fraud Investigation Office to probe the affairs of Moser Baer India Limited, along with its subsidiaries, joint ventures, and associate companies.

The Delhi High Court later set aside this direction in a judgment delivered on August 28, 2025.

The ruling came on a petition filed by Nita Puri, a former director of Moser Baer India Limited. She had challenged the SFIO probe on the ground that two forensic audits commissioned to examine alleged diversion of funds, siphoning of assets, and fraudulent transactions had not found any irregularities. Despite this, the Ministry of Corporate Affairs relied on those very reports to justify ordering an investigation.

The Supreme Court noted that while quashing the investigation order, the Delhi High Court had relied on earlier proceedings in which actions taken by Bank of Baroda and State Bank of India to declare Ratul Puri a willful defaulter were set aside.

It also noted that the High Court had relied on the Bombay High Court's 2016 judgment in Parmeshwar Das Agarwal, which sets out the standard for formation of opinion under Section 212(1)(c) of the Act. That judgment, the Court pointed out, had already been challenged before the Supreme Court and dismissed earlier “not only on the ground of delay but also on merits.”

Agreeing with the Delhi High Court's approach, the apex court said the validity of the government's order had to be judged only on the reasons recorded in the order itself. It held that the High Court “has rightly adjudged the validity of the order under Section 212(1)(c) of the Act on the basis of the contents of the order itself, and not on the vice of fresh reasons or subsequent developments or by calling report of SFIO.”

It added that the High Court, being bound by the law laid down in Barium Chemicals and Mohinder Singh Gill, “has not committed any error.” dismissing the plea.

For Petitioners: Senior Advocate Santosh Paul, with AOR Ankur Yadav, and Advocates Shashank Shekhar and Abhimanyu Roy