New Delhi:The Supreme Court will deliver its judgment Wednesday regarding additional directions to SEBI, on a batch of pleas seeking a probe into allegations of fraud against the Adani Group of companies made in the Hindenburg report. A bench of Chief Justice of India (CJI) DY Chandrachud with Justices JB Pardiwala and Manoj Misra had reserved the verdict in November last year.
On November 24, last year, the Supreme Court had said that it could not see Hindenburg's report, against Adani Group, as ipso facto true state of affairs and due to this reason, it asked SEBI (Securities Exchange Board of India) to investigate. The apex court had stressed that there is no material to doubt SEBI’s probe and the impartiality of expert committee members while reserving its judgment on a batch of pleas seeking a court-monitored monitored investigation into the allegations made by US-based short-selling firm Hindenburg Research against the Adani group.
Advocate Prashant, representing an intervenor, had argued before the court that there were many factual revelations in the Hindenburg report and urged the court to see the executive summary for the findings of the report.
CJI said “Mr Bhushan, we do not have to see what is set out in the Hindenburg report as ipso facto as the true state of affairs…that is why we directed SEBI to investigate. Because for us to then accept a report of an entity which is not before us and whose veracity, we have no means of testing…that is why we asked SEBI to treat these as revelations…and exercise your (SEBI's) jurisdiction as an adjudicating body”.
Bhushan claimed the role of SEBI was also suspect as they knew about FPIs made through Mauritius route and cited a letter written then DRI chairman in 2014 to the then SEBI chief U K Sinha.
Bhushan’s allegations against SEBI’s investigation into the matter did not convince the apex court. "SEBI is a statutory body exclusively entrusted with investigating stock market manipulation. Is it proper for a court without any proper material to say that we don't trust SEBI and we will form our own SIT? This has to be done with much calibration…..," CJI told Bhushan.
Bhushan, representing a law student Anamika Jaiswal, argued that his client had filed a plea seeking a direction to constitute a fresh experts committee to probe the Adani group-Hindenburg report controversy, claiming apparent conflict of interest of members of the panel formed by the apex court. The application cited instances showing a conflict of interest between former SBI chairman O P Bhatt, former ICICI chairman M V Kamath, advocate Somashekhar Sundaresan and the Adani group. The committee also consisted of Justice J P Devadhar, and co-founder Infosys, Nandan Nilekani.
Before reserving its order on additional directions to the SEBI, the bench pulled up a counsel for seeking a probe against SBI and LIC in the matter, and asked him, "If it is some college debate…. and if he realises the implications of his prayer made without any substantial material."
The apex court had nominated all the members and the committee is headed by retired apex court judge, Justice Abhay Manohar Sapre. The apex court had constituted the expert committee in March 2023, on a batch of petitions filed by advocate Vishal Tiwari and others, to investigate the allegations made against the Adani Group in the Hindenburg Report and whether there was a regulatory failure in the same.
The committee, in its report submitted in May, said the allegations of stock price manipulation or violation of MPS norms by Adani Group companies cannot be proved at this stage.
