New Delhi, May 30 -- The Supreme Court on Friday exonerated Reliance Industries Limited (RIL) of allegations of fraudulent and manipulative trading in the 2007 Reliance Petroleum futures case, holding that the Securities Appellate Tribunal (SAT) committed an "egregious error" in sustaining findings of fraud against the company. A bench of justices JB Pardiwala and R Mahadevan set aside directions issued by the Securities and Exchange Board of India, later upheld by the SAT for disgorgement of Rs.447.27 crore arising out of trading in shares of Reliance Petroleum Limited in November 2007. Consequently, the court ordered refund of Rs.250 crore deposited by RIL in the Investor Protection Fund pursuant to interim directions passed earlier by the Supreme Court. However, the court upheld a separate penalty of Rs.25 crore imposed on RIL for violating disclosure requirements under the 2001 SEBI Circular relating to position limits in the futures and options segment. "For all the foregoing reasons, we have reached the conclusion that the SAT in its majority judgment, committed an egregious error in passing the impugned judgment insofar as the question of fraud under Regulations 3 and 4 of the PFUTP Regulations respectively, is concerned," the bench held. PFUTP Regulations refer to the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, which prohibit market manipulation, fraudulent trading and deceptive practices in securities transactions. The judgment came in appeals filed by RIL challenging a 2020 SAT majority ruling which had upheld findings by a SEBI whole-time member that the company engaged in a fraudulent trading scheme through 12 entities in the derivatives segment while selling Reliance Petroleum shares in the cash market....