[BREAKING] Hindenburg-Adani | "SC Registrar Refusing To List Plea On Delay In SEBI Probe": Appeal In Supreme Court

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Advocate Vishal Tiwari, who initially petitioned the Supreme Court (SC) regarding the Adani-Hindenburg issue, plans to submit another plea requesting the apex court to compel the Securities and Exchange Board of India (Sebi) to release its final report on the investigation.

[Adani-Hindenburg Row] New Plea in SC Demanding Disclosure of Sebi's Final Findings in Adani's Case — [Adani-Hindenburg Row] New Plea in SC Demanding Disclosure of Sebi’s Final Findings in Adani’s Case

NEW DELHI: Today (13th Aug): A new plea has been filed in the Supreme Court addressing recent allegations by Hindenburg Research against Adani, SEBI, and its chairperson Madhabi Buch, with the petitioner also raising concerns about the alleged refusal of the Supreme Court Registrar to register the case.

Advocate Vishal Tiwari, who initially petitioned the Supreme Court (SC) regarding the Adani-Hindenburg issue, plans to submit another plea requesting the apex court to compel the Securities and Exchange Board of India (Sebi) to release its final report on the investigation.

Tiwari informed the media agency that he aims to file this plea by Monday night, urging the SC to mandate Sebi to disclose its findings.

He noted, “There has been a delay in releasing the investigation results. The SC had set a three-month deadline in January, which has long expired. We are asking for the findings to be made public.”

The push for the final report intensified after Hindenburg Research released a new report questioning the impartiality of Sebi Chairperson Madhabi Puri Buch. The report alleged that Puri Buch had a “stake” in an offshore fund used by the Adani group to breach regulations. Sebi’s Chairperson has denied these allegations and provided a detailed rebuttal.

On Sunday, Sebi stated that it had completed one of the two ongoing investigations and that the remaining one was close to finishing. In January, the SC had instructed Sebi to conclude its probe within three months. Sebi reported to the court that it had completed investigations into 22 of 24 matters.

An appeal has been lodged on Aug 13th, with the Supreme Court contesting the registry’s refusal to list an application that requested a status report from SEBI regarding its response to fraud allegations by US short-seller Hindenburg Research against the Adani group.

Advocate Vishal Tiwari, who filed the appeal, noted that a January 3 order had given SEBI three months to complete its investigation. The Supreme Court had previously opted not to intervene or mandate additional actions concerning Hindenburg’s allegations of stock manipulation against Adani, stating that it would not rely on media reports and would leave further decisions to SEBI.

Tiwari’s new plea argues that the Court’s reference to completing the probe “preferably” within the set timeline should not be interpreted as not imposing a deadline. Since this period has elapsed, Tiwari has sought to file a fresh application requesting the following:

Submission of SEBI’s investigation report on the Adani-Hindenburg issue, as directed by the Supreme Court on June 3.
A status report from the Central Government and SEBI on whether they have acted on the recommendations of the Court-appointed Expert Committee to enhance the Indian securities market.
Detailed reports from the Central Government and SEBI on the share market crash and investor losses following the Lok Sabha 2024 results.

However, on August 5, the Court’s Registrar rejected the application, labeling it as “thoroughly misconceived” and lacking reasonable cause. The Registrar contended that the Court had not set a deadline for SEBI’s investigation, contrary to Tiwari’s claims.

Tiwari has challenged this decision in his appeal, arguing that the rejection has denied his fundamental rights and barred access to the Court. He emphasized the importance of public and investor awareness regarding SEBI’s investigation conclusions, particularly following Hindenburg’s recent allegations of conflicts of interest involving SEBI Chairperson Madhabi Puri Buch and her husband.

In, August 10 Hindenburg report reasserted allegations of stock manipulation by Adani and suggested that SEBI’s perceived lack of action might be due to Buch’s and her husband’s investments in offshore companies linked to Adani. SEBI has responded by urging calm and reaffirming its commitment to maintaining market integrity, with Buch and her husband denying any conflicts of interest.

The SC had ruled against transferring Sebi’s investigation of the Adani-Hindenburg case to a special investigation team and found no grounds to reverse the amendments to the Sebi (Foreign Portfolio Investors) Regulations and Sebi (Listing Obligations and Disclosure Requirements) Regulations.

Chief Justice of India D Y Chandrachud’s Bench observed that the regulations were free from any flaws.

The court was clear in its support of SEBI, stating that the regulator’s conduct “inspired confidence” in its investigation. The judgment noted that SEBI had carried out a “comprehensive investigation” into the allegations against the Adani Group. At the time of the ruling, SEBI had completed 22 out of the 24 investigations, with the remaining two awaiting inputs from “external agencies/entities” before a decision could be made on the next steps.

Hindenburg Research, a well-known shortseller, has accused SEBI Chairperson Madhabi Buch of having undisclosed stakes in obscure offshore entities allegedly involved in what the firm has described as “the Adani money siphoning scandal.” These new allegations have sparked a political storm, with opposition leaders taking to social media to voice their concerns.

In its January 3 judgment, the Supreme Court acknowledged its authority under Article 32 and Article 142 of the Constitution to transfer an investigation from the “authorised agency” to the Central Bureau of Investigation (CBI) or to constitute an SIT. However, the court emphasized that this power should only be exercised in exceptional circumstances.

Previously, an expert committee overseeing the market had reported that Sebi faced challenges in its investigation of the conglomerate, especially concerning regulators in offshore jurisdictions where some foreign portfolio investors are located.