New Delhi : The Supreme Court on Wednesday dismissed the plea to transfer the investigation concerning Adani group companies’ alleged securities law violations to a special investigation team (SIT). This decision provided relief to the conglomerate nearly a year after the Hindenburg Research published its report.
Furthermore, the court instructed the Securities and Exchange Board of India (SEBI) to conclude the remaining two out of the 24 probes within three months. Headed by Chief Justice of India (CJI) DY Chandrachud, the bench stated its inability to intervene in SEBI’s jurisdiction. The court also rejected accusations of a conflict of interest against the panel formed in March 2023 to examine the Hindenburg report’s assertions. Additionally, the court urged the government and SEBI to examine whether the short selling of stocks subsequent to the Hindenburg report breached local laws.
The Hindenburg Report : The Adani-Hindenburg controversy refers to allegations made by the Hindenburg Research, a financial analysis firm, in a report released in early 2023. The report accused various Adani Group companies, particularly Adani Enterprises Ltd., of engaging in alleged financial irregularities, including inflating capital expenditures and manipulating the valuation of certain transactions.
Hindenburg Research’s report raised concerns about the transparency and accuracy of the Adani Group’s financial practices, suggesting potential violations of securities laws. The allegations sparked a significant controversy and drew attention from regulators and the public regarding the operations and financial disclosures of the Adani conglomerate, one of India’s largest business groups.
Following the report’s release, there were calls for investigations into these allegations. Some parties demanded an inquiry by a Special Investigation Team (SIT) to investigate the claims made by Hindenburg Research and ensure impartial scrutiny of the Adani Group’s financial dealings. However, the Supreme Court of India rejected the plea to transfer the investigation to an SIT, supporting the Securities and Exchange Board of India (SEBI) in conducting its inquiries into the matter.