Reliance Industries' attempts to settle the Reliance Petroleum insider trading case through consent orders has once again been thwarted by market regulator Sebi, which has also issued a show-cause notice to RIL before giving its final order in the case. The case deals with allegations against certain entities who short-sold shares of Reliance Power on behalf of RIL, ahead of its merger. Short selling is a process where an entity or trader sells shares in the market without owning them with expectations that prices will fall, to buy them at a later date and thereby earn a profit. Sebi is probing the sale of Reliance Petroleum stock futures in the first week of November 2007. According to a report in the Economic Times, RIL made a profit of Rs 500 crore from the sale of Reliance Petroleum shares.
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