LIC says its ITC investment is ‘in interest of public welfare’

The Life Insurance Corporation of India (LIC) said its investment in cigarette maker ITC has been made with the bona fide objective of enhancing returns for its policy holders, investors, and in the interest of public welfare.

LIC, along with other state insurers and the central government, have been dragged to the Bombay High Court in a public interest litigation (PIL) questioning government investment in ITC and other tobacco companies.

In its affidavit, LIC said there was no regulation, which banned investment in ITC and denied that its shareholding contradicts the government’s tobacco control policies. LIC said investments made in ITC were through the secondary market and routine in nature. The insurer has sought a dismissal of the petition. Public sector insurance companies and the Specified Undertaking of United Trust of India hold 32 per cent stake in ITC.

Wife of former home minister Satish Pednekar, Sumitra Pednekar, Tata Memorial Hospital surgeon Pankaj Chaturvedi, and managing trustee of Tata Trusts R Venkataramanan (in his individual capacity) filed the PIL in April.

The HC made the Securities and Exchange Board of India (Sebi) a party to the petition in the same month.

Sebi, however, has sought to distance itself from the issue. In its affidavit, filed on Friday, Sebi said that petitioners have neither prayed for any relief against it, nor alleged its involvement in the share ownership.