Hindenburg Research Report: Fresh Plea in Supreme Court

Hindenburg Research: Fresh Plea Before SC

"I have submitted a fresh petition in the Supreme Court, appealing against the lodgement order and urging the court to instruct SEBI to expedite its investigation into the Adani Group and promptly submit a report. Although the court had granted SEBI a three-month period in January to complete the investigation, it remains unfinished. Since the release of the second Hindenburg Research report, there has been growing suspicion among the public regarding SEBI's role," stated Vishal Tiwari, the petitioner to The Probe. 

Tiwari submitted the petition to the Supreme Court today, requesting the swift completion of SEBI’s ongoing investigations into the Adani Group and the prompt release of the findings. In his petition, Tiwari highlighted that the Supreme Court had set a clear three-month deadline on January 3, 2024, for SEBI to conclude its investigation. This, he argued, is crucial for the public and the investors who suffered financial losses following the release of the 2023 Hindenburg report on the Adani Group. Tiwari emphasised the importance of the public's right to know the results of SEBI's investigation, which he believes is vital for protecting investors' interests.

The petitioner also references the latest report by Hindenburg Research, stating, "Again, a new report has been published by Hindenburg. The US-based short-seller, in a report released on Saturday, alleged that the current Chairperson of the Securities and Exchange Board of India (SEBI) and her husband had stakes in offshore funds linked to the Adani Group's alleged money syphoning scandal. The report cited 'whistleblower documents.' This report comes a year and a half after its damaging report on the Adani Group, which had far-reaching consequences, including the cancellation of the company's flagship Rs 20,000 crore follow-on public offer."

The petition asserts that, although the SEBI chief has dismissed these allegations as baseless and the court has ruled that third-party reports cannot be considered, the situation has nonetheless fostered an atmosphere of doubt among the public and investors. Given these circumstances, the petition argues that it is crucial for SEBI to conclude its ongoing investigations and promptly announce the results.

In a status report submitted earlier to the court, SEBI had outlined the current status of its investigations and explained the interim findings for two of them. The report includes details such as the number of emails sent, summons issued for personal appearances, the volume of documents reviewed, and statements recorded under oath for each investigation. Here is an overview of the twenty-four investigations conducted by SEBI:

The latest Hindenburg Research report on the Adani Group has sparked massive controversy. The first report prompted demands for a thorough investigation. When the case was brought to the Supreme Court, the Court directed SEBI to expedite its investigation and subsequently dismissed the matter. However, the release of the second Hindenburg Research report, which implicated SEBI’s Chairperson herself, has intensified calls for an impartial inquiry. Many believe that as long as the allegations target SEBI's Chairperson, a fair investigation may be compromised.

The opposition has voiced strong criticism of the market regulator following the release of the latest Hindenburg report, calling for the resignation of SEBI Chairperson Madhabi Buch. On Sunday, Rahul Gandhi, Leader of the Opposition in the Lok Sabha, demanded a Joint Parliamentary Committee (JPC) inquiry into the allegations against Buch. In response, the BJP has dismissed these claims, alleging that global forces, aided by the Congress “dynasty,” are attempting to obstruct India’s progress.

Speaking to The Probe, senior lawyer Prashant Bhushan stated, “I believe it is high time the truth should come out. SEBI’s investigations have been ongoing for a long time. The public has the right to know the outcome. However, now that SEBI’s role is in question, an impartial probe is essential. The opposition must raise this issue. A JPC investigation is necessary. Madhabi Buch, the SEBI Chairperson, should be compelled to resign. If the government continues to resist, it will only face increasing political damage.”

Meanwhile, the Adani Group, SEBI, and Madhabi Buch along with her husband Dhaval Buch have refuted all the allegations made in the Hindenburg Research report in various press statements.

To read our detailed pieces on this developing story, click here and here.