New Delhi: The Supreme Court on Monday declined to entertain a plea by a lawyer against the court’s registry declining to list an application seeking a status report from the SEBI on the action taken to address allegations of fraud by US short-seller Hindenburg Research against the Adani group of companies.
The matter came up before a bench comprising Justices JB Pardiwala and Justice R Mahadevan. The plea was filed by advocate Vishal Tiwari in August last year. During the hearing, the bench asked how much cost should be imposed on the petitioner. After hearing submissions, the bench declined to entertain the plea and no cost was imposed on the petitioner. The development has come weeks after Hindenburg Research announced it was shutting down.
Citing an earlier order passed by the apex court, the application said the Securities and Exchange Board of India (SEBI) was given three months to complete its probe. "It is important in the public interest and for the interest of the investors who lost their funds after the publication of the Hindenburg report in 2023 against the Adani group. The Right to know about the investigations led by SEBI and its conclusions are essential for the benefit of investors….", contended the plea.
The application had said the US-based short-seller Hindenburg Research, in a new report released, alleged that the current chairperson of SEBI, Madhabi Puri Buch, and her husband, Dhaval Buch, had stakes in offshore funds linked to the Adani Group's alleged money siphoning scandal. "The report cited whistleblower documents. The report comes a year and a half after its damaging report on the Adani Group that had far-reaching consequences, including the cancellation of the company's flagship Rs 20,000 crore follow-on public offer," said the plea.
The plea said: "The SEBI chief has denied these allegations as baseless and this court also held that third-party reports cannot be considered. But this all has created an atmosphere of doubt in the minds of public and investors and in such circumstances, it becomes incumbent for SEBI to conclude the pending investigations and declare the conclusion of the investigations".
In January last year, the top court had declined to interfere or order further action on allegations of stock manipulation levelled by US-based short seller against the Adani group.
The plea contended that the court's decision in January to say that the probe should "preferably" be completed within this timeline does not mean that no deadline was fixed. Since the "deadline" had elapsed, Tiwari, who was one of the petitioners in the main matter, moved a fresh application. On August 5, 2024, the apex court's registrar declined to register the application stating that it was "thoroughly misconceived" and does not disclose any reasonable cause.
