Adani-Hindenburg row | Supreme Court to pronounce verdict on January 3, 2024

The logo of the Adani Group is seen on the facade of one of its buildings on the outskirts of Ahmedabad on April 13, 2021.
| Photo Credit: Reuters

The Supreme Court will pronounce its judgment on January 3 on a plea to form a separate Special Investigation Team (SIT) to investigate Hindenburg Research’s allegations against the Adani Group.

A three-judge Bench headed by Chief Justice of India D.Y. Chandrachud had reserved the petition filed by Anamika Jaiswal, through advocate Prashant Bhushan, who had argued that the earlier committee, headed by former Supreme Court judge Justice A.M. Sapre, had a “conflict of interest” on the issue.

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Mr. Bhushan had contended that one of the committee members, O.P. Bhatt, a former chairman of the State Bank of India, is Chairman of Greenko, a leading renewable energy company. Since March 2022, Greenko and the Adani Group have worked in a close partnership to provide energy to Adani Group facilities in India, he submitted.

‘Conflict of interest’

The senior lawyer had also trained his guns on advocate Somasekhar Sundaresan, another committee member who was recently appointed an Additional Judge of the Bombay High Court. Mr. Bhushan said that Mr. Sundaresan had appeared as a lawyer for the Adani Group in 2006 and had been on “several SEBI committees”.

The Justice Sapre Committee was constituted by the Supreme Court on March 2 to investigate the causal factors and existence, if any, of regulatory failure which led to investors losing crores due to volatility in the securities market following Hindenburg Research’s report accusing the Adani Group of manipulation of share prices and account fraud.

Fraud, stock manipulation allegations

Mr. Bhushan had also raised in court foreign media reports about the findings of the Organized Crime and Corruption Reporting Project (OCCRP), a non-profit, which also alleged stock manipulation and accounting fraud by the Adani Group.

The court had also heard Mr. Bhushan’s claim that the Securities Exchange Board of India (SEBI) had “concealed” an alert received from the Directorate of Revenue Intelligence (DRI) about “Adani having siphoned off money and invested them in Adani listed companies through entities based in Dubai and Mauritius”.

Solicitor General Tushar Mehta had, however, countered that the DRI had closed its probe in 2017 and the issue had already travelled up to the Supreme Court and the Customs Excise and Service Tax Appellate Tribunal.

According to Mr. Bhushan, the DRI’s letter to the then-SEBI chairperson, U.K. Sinha, on January 31, 2014, issued an alert that “there may be stock market manipulation being committee by the Adani group of companies using the money siphoned off through overvaluation in the import of power equipment by Adani group”. The DRI was at the time investigating a case of overvaluation of import of equipment and machinery by various entities of the Adani Group from a subsidiary based in the United Arab Emirates.