Sebi notified the Supreme Court on August 25 that it had concluded its investigation into all but two claims against the Adani Group and was still expecting evidence from five tax havens.
A public interest litigation (PIL) in the Adani-Hindenburg row has alleged in an affidavit that market regulator Securities and Exchange Board of India (Sebi) suppressed important facts from the Supreme Court (SC) and “slept over” the Directorate of Revenue Intelligence (DRI)’s letter on alleged stock manipulation by the Adani firms.
Four PILs on the Adani-Hindenburg conflict have been filed with the Supreme Court, including those by attorneys ML Sharma and Vishal Tiwari, Congress activist Jaya Thakur, and law student Anamika Jaiswal.
Sebi notified the Supreme Court on August 25 that it had concluded its investigation into all but two charges against the Adani Group and was still seeking information from five tax havens on the true owners of the foreign firms that had invested in the conglomerate.
The Sebi informed the Supreme Court that 22 of the 24 cases it was investigating had finalized conclusions.
According to Jaiswal’s affidavit, while the investigation against the Adani group in the over-invoicing case was ongoing, DRI sent a letter to the then-Sebi chairperson in 2014 alerting him to the possibility that the group was engaging in stock market manipulation using the money allegedly siphoned off using the modus operandi of over-valuation in the import of power equipment.
According to the affidavit, the letter was accompanied by a CD holding proof of siphoning off Rs 2,323 crore and two notes on the matter being probed by the DRI. According to the affidavit, the letter further suggested that more papers may be obtained from the DRI’s Mumbai Zonal Unit.
“The petitioner herein submits that, not only has the Sebi suppressed important facts from this court and slept over DRI alerts, but there is also an apparent conflict of interest in the Sebi conducting the Adani investigation.”
“Cyril Shroff Managing Partner, Cyril Amarchand Mangaldas has been a member of Sebi’s Committee on Corporate Governance, which looks at offences like insider trading,” according to the affidavit, adding that his daughter is married to Gautam Adani’s son. According to the affidavit, this demonstrates an obvious conflict of interest.
“The petitioner herein submits that, not only has the Sebi suppressed important facts from this court and slept over DRI alerts, but there is also an apparent conflict of interest in the Sebi conducting the Adani investigation.”
“Cyril Shroff Managing Partner, Cyril Amarchand Mangaldas has been a member of Sebi’s Committee on Corporate Governance, which looks at offences like insider trading,” according to the affidavit, adding that his daughter is married to Gautam Adani’s son. According to the affidavit, this demonstrates an obvious conflict of interest.
Hindenburg Research accused accounting fraud, stock price manipulation, and unlawful use of tax havens in a January 24 report, prompting a stock market collapse of Adani group shares that destroyed nearly to $150 billion in market value at its lowest point.
Following this, the Supreme Court directed Sebi to examine the claims and report back. In March, a second six-member expert team was created to investigate the regulatory elements of the claims, which comprised a former judge and seasoned bankers.
