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- Adani Hindenburg Controversy; Supreme Court Hearing Updates | Gautam Adani
New Delhi40 minutes ago
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The Supreme Court will hear all the petitions filed in the Adani-Hindenburg dispute today. In the matter, the court had formed a six-member committee and asked to submit the report within two months. On May 8, the committee submitted its report in a sealed envelope. However, it is not yet clear whether the committee has given the final report of the probe or has sought more time.
On the other hand, the court had asked the Securities and Exchange Board of India (SEBI) to investigate the manipulation of share prices in two months. After this, on April 29, market regulator SEBI asked for another 6 months to complete the investigation in the matter. SEBI had told the Supreme Court that considering the complexity of the case, it would take at least 15 months to complete the investigation, but efforts would be made to finish it in 6 months.
4 PILs were filed in the Adani-Hindenburg dispute case. The petitions were filed by advocates ML Sharma, Vishal Tiwari, Congress leader Jaya Thakur and social worker Mukesh Kumar. The first hearing in the matter was held on February 10 by Chief Justice DY Chandrachud, Justices PS Narasimha and JB Pardiwala.
The court had formed a 6-member committee on March 2
The committee constituted by the Supreme Court is headed by retired judge AM Sapre. Along with him, the committee includes Justices JP Deodhar, OP Bhat, MV Kamath, Nandan Nilekani and Somashekar Sundaresan. On March 2, a bench of Chief Justice DY Chandrachud, Justice PS Narasimha and JB Pardiwala gave this order to form the committee.
Apart from the committee, SEBI is examining these 2 aspects…
- Whether Rule 19(A) of the Securities Contract Regulation Rules was violated?
- Was there any manipulation of stock prices in violation of existing laws?
Rule 19 (A) is related to minimum public shareholding
Rule 19 (A) of the Contract Regulation Rules deals with the minimum public shareholding of companies listed on the stock market. According to Indian law, at least 25% of the shareholding in any listed company should be held by the public ie non-insiders.
A report was presented by US-based short selling firm Hindenburg Research. It was alleged that Gautam Adani’s brother Vinod Adani manages shell companies abroad. Through them, billions of dollars were transferred to Adani Group’s listed and private companies in India. This helped Adani Group to evade the laws.
These instructions were given by the Supreme Court
- SEBI chairperson will have to give all necessary information to the expert committee
- Agencies associated with the central government will have to cooperate with the committee
- The committee may consult outside experts for its work.
- The payment of committee members will be decided by the chairperson and the central government will bear it.
- Union Finance Minister Nirmala Sitharaman will nominate a senior officer
- He will act as the nodal officer for providing logistic assistance to the committee.
- The central government will bear all the expenses of the committee.
The petitions demanded registration of FIR and investigation
- In the petition, Manohar Lal Sharma demanded investigation and FIR against Hindenburg Research founder Nathan Anderson and his associates in India. Along with this, a ban on media coverage was also demanded on this matter.
- Vishal Tiwari had demanded an inquiry into the Hindenburg report by forming a committee headed by a retired SC judge. In his petition, Tiwari had told about the condition of the people when the stock prices fall down.
- Jaya Thakur had raised doubts on the role of Life Insurance Corporation of India (LIC) and State Bank of India (SBI) in this matter. He demanded an inquiry into the role of LIC and SBI in investing huge amounts of public money in Adani Enterprises.
- In his petition, Mukesh Kumar had sought directions from SEBI, ED, Income Tax Department, Directorate of Revenue Intelligence to investigate. Mukesh Kumar had filed this petition through his lawyers Rupesh Singh Bhadauria and Mahesh Praveer Sahay.
SC refuses to ban media coverage of the case
Earlier, the Supreme Court had rejected a petition seeking a ban on media coverage on the matter. The court had said that it cannot stop the media from reporting. At the same time, the court had said that it has reserved its decision regarding the constitution of the committee to investigate the matter and it will be heard soon.
Hindenburg report harmed investors
The petitions claimed that Hindenburg short-sold the shares, causing “huge losses to investors”. It has also been said that the report has tarnished the image of the country. It is affecting the economy. Simultaneously, the media hype over the report affected the markets and Hindenburg founder Nathan Anderson also failed to provide proof of his claims to the Indian regulator SEBI.
Hindenburg had made allegations like stock manipulation
On January 24, Hindenburg Research published a report regarding the Adani Group. In the report, allegations ranging from money laundering to share manipulation were made on the group. After the report, there was a huge fall in the shares of the group. However, later it recovered.