Supreme Court to render decision in Adani Hindenburg case today

In January 2023, the Gautam Adani-led group was accused of "brazen accounting fraud" and "stock manipulation" by Hindenburg's report.

The US short-seller Hindenburg Research produced a research paper in January 2023 that contained accusations of accounting fraud and stock manipulation against Adani group firms. The Supreme Court will rule on these petitions on Wednesday.

Judges JB Pardiwala and Manoj Misra, along with Chief Justice Dhananjaya Y. Chandrachud, will sit on a bench to decide what actions the Securities and Exchange Board of India (Sebi) should take to safeguard investors by reining in excessive market volatility and tightening relevant regulations.

Following the end of the arguments, the CJI will issue the judgment in the matter that was reserved on November 24, according to the list of business posted on the court website.

The Gautam Adani-led group was accused of "stock manipulation" and "brazen accounting fraud" in the Hindenburg investigation, which was released in January 2023. The report was dismissed by the firm as "maliciously mischievous" and "unresearched," but it set off a large sell-off of Adani Group equities that resulted in a loss of over $140 billion in a matter of days and necessitated the cancellation of a planned share sale of €20,000 crore.

On March 2, 2023, the Supreme Court appointed retired Supreme Court judge AM Sapre as the head of a six-member commission to investigate the Adani group's alleged legal violations and Sebi's regulatory failures. The committee stated in its May report that it is "at this stage" impossible to prove the claims made against Adani group entities for stock price manipulation and other MPS norm violations.

According to the court, it is not permitted to order an investigation solely based on media allegations without consulting the parties who would be affected by the directives. Stating that it is unrealistic to expect a statutory regulator like Sebi to begin issuing show-cause notices based solely on Hindenburg or Financial Times reports.

Also read: Amit Shah chairs high-level security review meeting on Jammu and Kashmir

The bench noted that it would not be appropriate for the court to create a Special Investigation Team (SIT) to probe into the alleged breaches of MPS regulations by Adani group firms without proof of any shortcomings on the part of the Sebi, which is currently looking into the case.

OTT India updates you with the latest news, Country’s no.1 digital news platform OTT India, Keeps you updated with national, and international news from all around the world. For more such updates, download the OTT India app on your Android and IOS device