Sebi clears Max Financial, Max Life and Axis Bank in 2010-2020 dealings case

The regulator examined three arrangements involving share issuances, buybacks and corporate agency agreements between the parties. Sebi had alleged that shares were issued or sold to Axis Bank at par or discounted prices and later repurchased at higher values, resulting in undue benefits to Axis entities to the tune of ₹3,911.95 crore in the 2020 arrangement.

It also looked into whether Max Financial Services failed to make timely and adequate disclosures about these transactions, including details of the corporate agency setup, share issues, buybacks and other terms.

However, Sebi concluded that the disclosure-related charges could not be sustained due to lack of material evidence showing violations of the specific provisions that applied at the time of the transactions. The regulator noted that disclosure norms for listed companies have evolved since 2010 and that entities must be judged under the rules prevailing when the deals occurred.

Sebi further found that the allegation of a fraudulent scheme to defraud Max Financial Services shareholders was not established. It also clarified that there was no claim of market manipulation through artificial inflation of price or volume.

With both the disclosure and fraud allegations unproven, Sebi dropped charges against the key managerial personnel of the involved companies. The proceedings against all noticees were closed without any directions or penalties being imposed.