Stand by Parliament reply that SEBI was investigating some Adani Group companies, says Finance Ministry

Image used for representational purpose.

The Finance Ministry said that it stands by its reply in Parliament in July 2021 that the stock market regulator was probing some Adani group companies. It said this hours after Congress sought to target the government over the Securities and Exchange Board of India submission in the Supreme Court in which it termed as baseless the contention that it is already investigating Adani Group companies since 2016, reported ANI.

The Finance Ministry's response came after Congress leader Jairam Ramesh made accusations that the government is misleading parliament. Responding to Jairam Ramesh's tweet, Ministry of Finance said that the "government stands by its reply in Lok Sabha on July 19, 2021."

"The Government stands by its reply in Lok Sabha on 19th July 2021 to Q. No. 72, which was based on due diligence and inputs from all concerned agencies," read a Tweet by Finance Ministry.

The Congress leader had alleged that there was inaction on part of SEBI or the government mislead the parliament. "The Minister of State for Finance, Pankaj Chaudhary, told the Lok Sabha on 19th July 2021 that SEBI was investigating the Adani Group. Now SEBI tells the Supreme Court that they have not been investigating any of the serious allegations against Adani!," Jairam Ramesh said in a tweet. "Which is worse--misleading Parliament, or being fast asleep as lakhs of investors are duped by alleged money-laundering and round-tripping using offshore shell companies? Or even worse, was there a restraining hand from above?" he added.

The government had said in its reply that SEBI is investigating some Adani group companies with regard to compliance with the regulator's guidelines.

According to ANI report, SEBI filed a rejoinder affidavit in Supreme Court in response to a petition relating to Hindenburg Research's report on the Adani Group. SEBI apprised the Supreme Court that the market regulator is already investigating Adani Group companies since 2016 is factually baseless.

Petitioners had alleged that SEBI was probing the Adani Group since 2016. SEBI has sought an extension to conclude the investigation in the report by US short-seller Hindenburg Research by a period of six months. Petitioners had alleged that SEBI was probing the Adani Group since 2016.

Also read: Insurance 'scam' case: CBI searches at nine locations in Delhi, Jammu & Kashmir

SEBI submitted before the Supreme Court that the application for extension of time filed by SEBI is meant to ensure carriage of justice keeping in mind the interest of investors and the securities market since any incorrect or premature conclusion of the case arrived at without full facts material on record would not serve the ends of justice and hence would be legally untenable. SEBI told the SC that the investigation done earlier by SEBI pertains to the issuance of Global Depository Receipts ("GDRs") by 51 Indian listed companies, in respect of which investigation was conducted. SEBI submitted before the Supreme Court that no listed company of Adani Group was part of those 51 companies it was investigating.

On March 2, the apex court directed the capital market regulator SEBI to investigate any violations of securities law by the Adani Group in the wake of the Hindenburg report, which led to a massive wipeout of more than USD140 billion of the Adani Group's market value. Supreme Court, on March 2, set up an expert committee on the issue arising from the Hindenburg Research report on Adani Group companies. The committee will consist of six members, headed by former apex court judge Justice AM Sapre.

The apex court had then asked SEBI to file a status report within two months. The apex court was then hearing petitions pertaining to the Hindenburg report, including on the constitution of a committee relating to regulatory mechanisms to protect investors' interests.

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". A short-seller in the securities market books gains from the subsequent reduction in the prices of shares.

(With inputs from ANI)