Delhi High Court has granted interim relief to Microsoft’s chief executive officer Satya Nadella and nine entities from a Ministry of Corporate Affairs (MCA) penalty order related to significant beneficiary ownership (SBO) in LinkedIn Technology Information.
The high court has granted an interim stay on the MCA order that required Nadella and nine entities to cumulatively pay INR2.71 million (USD28,325).
MCA alleges that in the regulatory filings, LinkedIn India is the registered owner of LinkedIn India and LinkedIn Ireland is a beneficial owner of one share in LinkedIn India. In another filing, it stated that LinkedIn India is the owner of one nominee share in LinkedIn Ireland.
This irregularity in disclosures led to an MCA conclusion that LinkedIn India is non-compliant with the required disclosures.
On 15 February 2024, the MCA issued a show cause notice to LinkedIn India. In its reply, LinkedIn India said the beneficial ownership of one share by LinkedIn Ireland was always reported accurately. LinkedIn added that the additional regulatory filing was made erring on the side of caution, with an erroneous date noting the date of filing instead of the actual date of creation of the share ownership and expressed its wish to withdraw the filing.
The MCA found the reply unsatisfactory and sent LinkedIn India an email on 4 March 2024 asking for reasons behind providing incorrect information.
In its reply to this email on 12 March 2024, LinkedIn India said it took a cautious approach and reaffirmed LinkedIn Ireland’s beneficial ownership in its filings, reiterating that the filings included an erroneous date. It also said the statutory language of “every person who holds or acquires beneficial ownership” must make the regulatory disclosure filings, led to the company erring on the side of caution.
In the MCA hearing on 12 March 2024, the authorised representatives of LinkedIn India had appeared and reiterated the same submissions.
The MCA in its analysis observed that the timelines LinkedIn India stated for the creation of the beneficial ownership did not match the regulatory filing requirements. The MCA also observes that there is no question of withdrawing the filings as they are part of the disclosures required by law.
The MCA also observed that based on LinkedIn 含羞草社区 answers and the test of control of significant influence, Microsoft Corporation has the SBO.
On 22 May 2024, the MCA observed that both LinkedIn India and LinkedIn Ireland are non-compliant with the regulatory disclosure filing requirements. The MCA also held Nadella and LinkedIn CEO Ryan Roslansky along with officers of LinkedIn liable for the penalty over non-compliance.
This order was challenged before the appellate authority of regional director, northern region, under the MCA and was dismissed on 27 February 2026.
The present case, , is the appeal that has been filed before Delhi High Court. The petitioners argued that the MCA has relied on filings by Microsoft Corporation before the US Securities and Exchange Commission to determine the SBO, which is different under US law than under Indian law.
The petitioners also argued that penalties were imposed on the CEO and other officers, even though they never had an opportunity to make any filings.
The court then granted interim relief of a stay order on the MCA’s penalty order and issued a notice to government authorities, which said that they would reply within eight weeks. The case is currently ongoing before the courts and the next hearing is on 6 October 2026.
