Adani-Hindenburg order: Supreme Court says no ground to doubt SEBI probe, it won't interfere
Adani-Hindenburg verdict: The Supreme Court refused to transfer the probe from SEBI to SIT and said SEBI has not been lackadaisical in the investigation.
In a major relief to the SEBI (Securities and Exchange Board of India) and the Adani Group, the Supreme Court on Wednesday refused to form an SIT (Special Investigation Team) to probe the allegations against the Adani Group and said SEBI will continue its investigation as there is no ground to prove that SEBI was lackadaisical. The Supreme Court said it can't enter into the domain of the regulatory regime and the report of Hindenburg or anything like that can't become the basis of ordering a separate probe. The SEBI will go ahead and continue its probe as per the law, the apex court said ordering SEBI to finish its investigation within three months.
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A bench comprising Chief Justice DY Chandrachud, Justice JB Pardiwala and Justice Manoj Misra delivered the judgment on as many as four petitions. The petitions were filed by lawyers Vishal Tiwari, ML Sharma and Congress leaders Jaya Thakur and Anamika Jaiswal.
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Reading out the verdict, the court said the power of the apex court to enter the regulatory framework of SEBI is limited. No valid grounds were raised to direct SEBI to revoke its amendments on FPI and LODR regulations. SEBI has completed investigation in 20 out of 22 matters. It will complete the investigation in the other two cases within three months, the order said.
The report of OCCPR cannot be taken into account to doubt SEBI investigation, the order said. The reliance on OCCPR report is rejected and reliance on a third-party organisation report without any verification cannot be relied upon as a proof, it said.
"Reliance on newspaper reports and third-party organisations to question the statutory regulator does not inspire confidence. They can be treated as inputs but not conclusive evidence to doubt SEBI probe," the order said.
What was the SEBI-Adani-Hindenburg case?
The petitioners said SEBI which was investigating the charges against the Adani Group provided a shield for the Adani Group's regulatory contraventions and market manipulations. The Supreme Court then asked SEBI to independently investigate the matter and constituted a committee of experts headed by former SC judge Justice AM Sapre.
During the hearing of the case, Solicitor General Tushar Mehta, appearing for the SEBI, told the bench that there was "a growing tendency of planting stories outside India to influence things and policies inside India".
Hindenburg Research levelled a series of allegations against the Adani Group accusing it of fraudulent transactions and share-price manipulation. The Adani Group dismissed the charges as lies.