Hindenburg’s latest charges spark fresh plea in Supreme Court on Sebi’s Adani Group investigation

Hindenburg Research’s latest allegations against the chief of India’s capital market regulator have triggered a fresh plea in the Supreme Court demanding a swift conclusion to the probe into the Adani Group.

The petition seeks to revive an earlier plea that had sought a strict timeline for an investigation by the Securities and Exchange Board of India into Hindenburg’s January 2023 stock manipulation and money siphoning allegations against the Adani Group.

Advocate Vishal Tiwari, who filed the petition, referred to the Supreme Court’s 3 January order instructing Sebi to complete its probe within three months. In that same order, however, the court had declined to mandate further actions based on Hindenburg’s allegations.

On Saturday, Hindenburg sprung a fresh series of allegations, claiming that Sebi chairperson Madhabi Puri Buch and her husband had stakes in offshore funds linked to the Adani Group, among other charges, and implying that this hindered the regulator’s investigation.

Although Buch has strongly denied the allegations and expressed her willingness to disclose all financial documents, Tiwari in his petition has argued that these circumstances necessitate a conclusive Sebi report.

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Hindenburg’s latest report has created an “atmosphere of doubt in the minds of the public and investors,” he stated in his plea, seen by Mint. Tiwari added that it has now become incumbent for Sebi to “conclude the pending investigations and declare the conclusion of the investigations”. 

“It is important in the public interest and for the interest of the investors who lost their funds after the publication of the Hindenburg report in 2023 against the Adani Group. The right to know about the investigations led by Sebi and its conclusions is essential for the benefit of investors,” he added.

Tiwari’s application specifically seeks to compel Sebi to submit its investigation report on the Adani-Hindenburg matter, as directed by the Supreme Court in its January order. 

“Not a strict deadline”

Tiwari in his plea has also sought a status report from both the Central government and Sebi on whether they have acted upon the recommendations of the Court-constituted Expert Committee aimed at strengthening the regulatory framework of the Indian securities market. 

Additionally, he has called for detailed reports from the government and Sebi concerning the share market crash and the financial losses suffered by investors following the Lok Sabha 2024 election result in July.

The Supreme Court’s Registrar had on 5 August refused to register Tiwari’s application, describing it as “thoroughly misconceived” and stating that it did not present a reasonable cause.

The Registrar had noted that the Supreme Court had not imposed a strict deadline for Sebi’s investigation, contrary to Tiwari’s assertion, and emphasized that the term “preferably” in the January directive did not constitute a firm deadline. 

The Registrar also pointed out that the court had not issued specific directives for submitting status reports regarding the Expert Committee’s recommendations or the investor losses post-election. 

The Registrar also mentioned that the review petition filed against the January judgment had already been dismissed, reinforcing the decision not to accept Tiwari’s latest application.

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