A recent development has emerged in the ongoing scrutiny surrounding the Adani Group’s stock price manipulation allegations. A petition for review has been filed in the Supreme Court, challenging the court’s January 3 decision. Initially, the Supreme Court had dismissed a plea to assign the probe into these allegations to either a Special Investigation Team (SIT) or the Central Bureau of Investigation (CBI), handing the responsibility instead to the Securities and Exchange Board of India (SEBI).
The original ruling articulated that SEBI was already conducting a thorough investigation into the claims. However, the review petition argues that this judgment contains “mistakes and errors,” presenting new material that purportedly justifies revisiting the verdict. The petition, lodged by Anamika Jaiswal through advocate Neha Rathi, critiques SEBI’s report to the court for not disclosing any specific findings or actions taken from its investigations. Out of 24 cases scrutinized, SEBI reported having completed 22, yet without revealing any substantive outcomes or measures undertaken.
The core of the petition’s argument is that without disclosing SEBI’s investigation results, one cannot conclusively determine the absence of regulatory failures. The plea aggressively points out what it perceives as “apparent errors” in the January 3 verdict, particularly the refusal to establish a court-monitored SIT to delve into alleged market manipulation and fraud involving offshore entities linked to the Adani Group.
The petition also contends that the Supreme Court overlooked SEBI’s regulatory lapses, which have potentially facilitated regulatory contraventions and statutory violations. Besides, it argues that certain aspects, such as the over-invoicing issue, might not have been proven, yet the involvement of Adani Group promoters in investing in their own group’s stocks through the Indian stock market has not been sufficiently investigated. This, according to the plea, warrants a comprehensive examination.
This legal motion follows a tumultuous period for the Adani Group, sparked by allegations from U.S.-based short-seller Hindenburg Research in early 2023. These claims, which suggested financial wrongdoing within the conglomerate, led to a significant plummet in the market capitalization of the Adani Group, surpassing $140 billion. The Adani Group has steadfastly denied these allegations, maintaining its adherence to all pertinent laws and disclosure requirements.
In delivering its judgment, the Supreme Court stressed its limited capability to directly intervene in the regulatory purview of SEBI concerning delegated legislation. It also underscored the necessity for SEBI to expedite and preferably conclude the pending investigations within three months, emphasizing the primacy of investigation outcomes over speculative reports or articles by third-party organizations.
The request for a review embodies a direct challenge to the initial verdict’s conclusion, arguing for the necessity of more transparent disclosures and a comprehensive evaluation of regulatory efficacy in the face of serious allegations. As legal proceedings continue, this case underscores the complex interplay between corporate governance, regulatory oversight, and the legal mechanisms designed to ensure market integrity and investor confidence.
