Delhi High Court Intervenes in MCA’s Action Against Tech Executives
In a significant legal development, the Delhi High Court has issued a stay on the Ministry of Corporate Affairs’ (MCA) order that penalized Microsoft CEO Satya Nadella, LinkedIn CEO Ryan Roslansky, LinkedIn India, and several of its directors. The penalties were related to alleged non-compliance with the disclosure of “significant beneficial ownership” (SBO) as mandated by Indian law. The stay will remain effective until the case’s next hearing scheduled for October 6, 2026.
Justice Anish Dayal’s Ruling
Presiding over the matter, Justice Anish Dayal noted the absence of instructions from the respondents, deeming it appropriate to stay the contested orders. His directive emphasized the need to maintain status quo until further deliberations on the case. The Court’s order stated, “Having appreciated the submissions advanced on behalf of petitioners, and there being no instructions on behalf of the respondents, this Court deems it fit to stay the operation of impugned orders till the next date of hearing. List on 06th October 2026.”
The Controversy Over SBO Disclosure
The controversy originated from the Registrar of Companies (RoC), which initiated proceedings against Nadella and others for allegedly failing to disclose their roles as significant beneficial owners in LinkedIn India. These findings were later upheld by a Regional Director of the MCA, citing violations of Section 90 of the Companies Act, which pertains to SBO disclosure requirements.
Arguments Presented by the Petitioners
Challenging the MCA’s order, Nadella and the other petitioners argued before the High Court that all necessary declarations had been submitted as of January 29, 2024. They contended that the RoC had misinterpreted Sections 89 and 90 of the Companies Act and incorrectly relied on disclosures made to the United States Securities and Exchange Commission (SEC). The petitioners highlighted the distinction between disclosures under U.S. securities law and the SBO framework under Indian law.
Legal Representation
The petitioners were represented by a formidable legal team, including Senior Advocate Gopal Subramanium and Luthra and Luthra Law Offices India. The legal team comprised Senior Partner Sanjay Kumar, Partner Abhishek K Singh, Managing Associate Saurabh Kumar, and Associate Vedanshi Jalan. On the other hand, the Union government and MCA’s case was represented by Advocates Vikrant Nilesh Goyal, Varun Pratap Singh, Rattan Goyal, Yash Basoya, Inderpreet Singh, and Kunal Dixit.
More Read
The case has garnered significant attention, and legal professionals and corporate entities alike are closely monitoring its progress. As the next hearing approaches, it remains to be seen how the court will adjudicate on this complex intersection of corporate disclosure requirements and cross-jurisdictional regulatory compliance.
