The Securities and Exchange Board of India (SEBI) has concealed a January 2014 DRI alert about Adani having siphoned off the money and invested it in Adani-listed companies through entities based in Dubai and Mauritius, one of the petitioners in the Hindenburg matter told the Supreme Court of India.
In 2014, DRI investigated a case of overvaluation of the import of equipment and machinery by various entities of the Adani Group from a UAE-based subsidiary, according to a report published by the news agency ANI.
“It is shocking that the SEBI has suppressed and concealed this important information from the top court and never conducted any investigation based on the DRI alert," said petitioner Anamika Jaiswal.
She said that SEBI has not disclosed the receipt of the said letter and evidence from the DRI to date before this court.
"Rather, they have categorically stated before the Expert Committee that the investigation into possible contraventions of rules and regulations by the Adani group of companies started on 23.10.2020 after receipt of complaints in June-July 2020," the affidavit read.
The petitioner said it is evident from the letter of the DRI that SEBI has suppressed facts and provided false information which amounts to perjury, as per ANI reports.
“The then SEBI chairperson UK Sinha instead of acting on the DRI letter preferred to close the ongoing investigations into the Adani group. It is pertinent to mention herein that the said SEBI chairperson in January 2014, was appointed on February 18, 2011, and retired on March 1, 2017," the affidavit read.
Interestingly, he is currently serving as "Non-Executive Independent Director-Chairperson" of NDTV, which has been acquired by the Adani group in 2022," the affidavit read.
She also apprised the court that more incriminating facts have come to light against the Adani group which have been described by various publications. The petitioner added that SEBI not only slept over the matter but it brought about a series of amendments only to benefit Adani, ANI reported.
The petitioner alleged that Violation of Rule 19A of the Securities Contract (Regulation) Rules 1957. Rule 19A of the Securities Contracts (Regulation) Rules, 1957 inserted by (Second Amendment) Rules, 2010 provides for the maintenance of minimum public shareholding and its attainment within a specified period.
"These companies would be in clear violation of Rule 19A of the SCRR, 1957 if the 13 suspected overseas entities were/are front companies for the Adani group promoters," the affidavit added.
Recently, SEBI has also filed a fresh status report before the Supreme Court of India apprised it that out of 24 investigations arising out of the Hindenburg report, 22 are final in nature and 2 are interim in nature, ANI reported.
The investigation was carried out in compliance with the directions of the top court's order dated March 2, 2023. The January 24 Hindenburg report alleged stock manipulation and fraud by the conglomerate.
The Adani Group has attacked Hindenburg as "an unethical short seller", stating that the report by the New York-based entity was "nothing but a lie".