'Hindenburg report can't become basis of....': What SC said in Adani verdict | Latest News India - Hindustan Times
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'Hindenburg report can't become basis of....': What SC said in Adani verdict

Jan 03, 2024 11:43 AM IST

The CJI said the power of the court to enter into the regulatory domain of SEBI was limited.

New Delhi: The Supreme Court of India on Wednesday refused to form a Special Investigation Team (SIT) into the allegations levelled by American short-seller Hindenburg against the Adani Group. It, however, asked SEBI to complete its probe into the pending two cases against the Gautam Adani-led conglomerate within three months. A bench, headed by CJI DY Chandrachud, said the court cannot regulate the market regulator's power of investigation and that it had completed its probe in 22 out of 24 cases linked to Hindenburg's allegations.

A logo of the Adani Group is seen on a commercial complex in Mumbai.(Reuters)
A logo of the Adani Group is seen on a commercial complex in Mumbai.(Reuters)

Delivering its verdict on a clutch of petitions on allegations of stock price manipulation by the conglomerate, the court said the facts of the case don't warrant the transfer of the probe to an SIT or any other probe agencies.

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The CJI said the power of the court to enter into the regulatory domain of SEBI was limited.

The Adani Group had called the charges "lies".

The Supreme Court said SEBI and the Centre can also probe if there was an infraction of law by the Hindenburg report on short-selling.

"Hindenburg or any other such report can't become the basis of ordering a separate probe," the court said.

The court also cautioned that petitions lacking adequate research and relying on unverified materials can prove to be counterproductive to the public interest jurisprudence.

The Supreme Court asked the Centre and SEBI to consider acting on the recommendations of the court-appointed panel.

It said there was no material to show that SEBI was lackadaisical in taking steps.

"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 added, per Live Law.

The bench said the scope of judicial review is only to examine if fundamental rights have been violated and there was no material to doubt investigation carried out by the SEBI.

The petitioners had demanded a court-monitored or CBI probe into the allegations.

Per ANI, the bench said there was no regulatory failure by SEBI. It added that the market regulator cannot carry out its functions based on press reports.

The Hindenburg allegations of market manipulation led to a massive erosion of the conglomerate's share prices and market value.

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