In a recent development, India’s highest court has dismissed pleas urging the establishment of a new panel to investigate fraud allegations against billionaire Gautam Adani’s companies, made by US firm Hindenburg Research earlier this year.
India’s Supreme Court Upholds Adani’s Innocence Amidst Fraud Allegations
The court had initially set up a committee in March to oversee the investigation conducted by India’s market regulator, the Securities and Exchange Board of India (Sebi), into the allegations of “brazen” stock manipulation and accounting fraud. However, in May, the panel reported that Sebi had not made significant progress in the inquiry.
Responding to the pleas, the Supreme Court has now directed Sebi to conclude its investigation within the next three months. Gautam Adani, who has consistently denied any wrongdoing, expressed satisfaction, stating that “truth had prevailed.”
Petitioners had raised concerns about the effectiveness of Sebi’s investigation and alleged a “conflict of interest” among some members in the court-appointed panel. However, Chief Justice DY Chandrachud dismissed these claims, emphasizing that there were “no grounds” to transfer the investigation to a special team.
“The power to transfer investigation must be exercised in exceptional circumstances. Such powers cannot be exercised in the absence of cogent justifications,” Chief Justice Chandrachud stated.
The court also rejected the argument about a conflict of interest among panel members and asserted that newspaper reports and investigations by third-party organizations cannot be considered conclusive evidence to question Sebi’s findings.
Hindenburg Research had accused Gautam Adani of “pulling the largest con in corporate history” in its report, which raised questions about the Adani Group’s ownership of companies in offshore tax havens and claimed the group had “substantial debt,” putting it on a “precarious financial footing.” The Adani Group denied the allegations, calling the report “malicious” and asserting compliance with all laws.
The fraud allegations triggered a significant decline in Indian markets, causing Adani Group’s companies to lose more than $100 billion in market value in the weeks following the report’s release. However, the stocks have since rebounded, experiencing a surge in price leading up to the Supreme Court’s recent verdict.
Gautam Adani, considered one of the world’s wealthiest individuals, has long faced accusations from opposition politicians of benefiting from political ties with Prime Minister Narendra Modi, which both Adani and the ruling party have consistently denied
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