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Supreme Court to Proceed with Hearing Case SEBI Investigation In Adani-Hindenburg Issue

New Delhi: One of the petitioners is suing SEBI for contempt of court for not finishing its investigation into the conglomerate’s alleged stock manipulation in a timely manner.

The lawsuit pertaining to the Securities and Exchange Board of India’s (SEBI) investigation into the Adani-Hindenburg case is scheduled to be heard by the Supreme Court of India again. One of the petitioners in the lawsuit has accused SEBI of being in contempt of court for not finishing its investigation into the Adani Group’s alleged stock manipulation on time.

Context

According to a report published in January 2023 by US-based short seller Hindenburg Research, the Adani Group had been involved in a “brazen stock manipulation and accounting fraud scheme over the course of decades.” Share prices of the Adani Group fell sharply as a result of the revelation, which sent shockwaves through the Indian stock market.

SEBI opened an inquiry on the claims in reaction to the Hindenburg report. The Indian Supreme Court mandated in May 2023 that SEBI finish its probe and turn up a report in three months.

Petitioner Asks for Court Proceedings to Be Contemptuous

Vishal Tiwari, an advocate involved in the case, has filed a contempt of court petition against SEBI, claiming the market regulator has disregarded the Supreme Court’s ruling. According to Tiwari, investors are suffering as a result of SEBI’s protracted probe.

Due to the complexity of the charges against the Adani Group, SEBI has defended its decision to take a longer time to conclude its inquiry. Additionally, the market watchdog has stated that it is dedicated to wrapping up its inquiry as quickly as feasible.

Supreme Court Will Proceed with Hearing Case

On November 29, 2023, the case is expected to be heard by the Indian Supreme Court. In addition to reviewing Tiwari’s plea for contempt of court, the court may provide SEBI instructions about how to proceed with its probe.

Consequences

The Adani Group and the Indian stock market may be significantly impacted by the case’s conclusion. Should the Supreme Court declare SEBI to be in contempt of court, the market regulator may be mandated to initiate legal action against the Adani Group. Penalties, sanctions, or even a halt to trading in Adani Group shares could fall under this category.

Furthermore, the Supreme Court’s decision might establish a standard for cases involving claims of accounting fraud and stock manipulation in the future. The Court’s ruling may have an effect on how SEBI carries out its investigations.

Investors, regulators, and the general public are keeping a close eye on the SEBI investigation into the Adani-Hindenburg affair. The Adani Group and the Indian stock market may be greatly impacted by the case’s verdict.

 

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