The Supreme Court of India has reserved its verdict in the high-profile case involving allegations by US-based short-selling firm Hindenburg Research against the Adani group of companies. The allegations, which accused Adani of stock market regulation violations, led to a significant drop in the group’s share value. The bench, led by Chief Justice of India DY Chandrachud, heard the matter extensively.
During the hearing, Advocate Prashant Bhushan, representing a petitioner, questioned the credibility of the Securities and Exchange Board of India (SEBI)’s investigation. Bhushan argued,
“We have come to the conclusion that the SEBI probe is not credible. They say 13 to 14 entries are linked to Adani but they cannot look into it because the FPI guidelines were amended.”
However, the Court expressed skepticism about directing SEBI based on media reports, with CJI Chandrachud stating,
“Mr. Bhushan, I do not think you can ask a financial regulator to take something printed in the newspaper… This does not discredit SEBI.”
Solicitor General Tushar Mehta, representing SEBI, contended that media reports were being “planted” to influence India’s actions. He alleged,
“There is a growing tendency of planting stories outside India to influence decisions within India. One example is the OCCRP report.”
The Court also addressed the impartiality of the Expert Committee members constituted to examine the regulatory framework. CJI Chandrachud disapproved of the allegations against the committee, stating,
“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.”
Bhushan raised concerns about the SEBI’s role, citing a Directorate of Revenue Intelligence (DRI) report from 2014. However, the Court and SG Mehta pointed out that the DRI had concluded its inquiry in 2017, finding no evidence against the Adani group.
The Court also refused to entertain a petition by Congress leader Jaya Thakur seeking an inquiry against the State Bank of India and the Life Insurance Corporation for investments into the Adani group. CJI Chandrachud remarked,
“Is this some debate in a college? You’re before a court. You realize the consequence of a direction against SBI and LIC? Absolutely no material by you and you’re alleging this. Surely there must be some responsibility.”
The case, titled Vishal Tiwari v. Union of India & Ors., now awaits the Supreme Court’s judgment, with the integrity of SEBI’s probe being upheld by the apex court.
