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In an application submitted before the Supreme Court on Monday, the Securities and Exchange Board of India (Sebi) sought a fortnight’s time more to submit a report in the Adani-Hindenburg matter while ascertaining that it has investigated 24 matters in the case.
“Out of the said 24 investigations/ examinations, 17 are final and complete and approved by the Competent Authority in accordance with Sebi’s extant practice and procedures,” said the regulator in the application.
The capital markets regulator has submitted that it has completed its investigation in one matter and prepared an interim report based on the material that could be gathered till now.
It added that Sebi has sought information from foreign agencies and regulators and upon receiving the information it will determine the further course of action.
“Out of the remaining 6 matters, in 4 investigations/ examinations, findings have been crystalized and the reports prepared consequent thereto are in the process of approval by the Competent Authority,” said Sebi.
The market watchdog said that it expects to complete the approval process in the four matters before August 29—the scheduled date for hearing on the matter in the Supreme Court (SC).
Investigation in one of these remaining two matters is at an advanced stage while an interim report is under preparation in the other one.
“We would have no objection if Sebi submits its report in the next 15 days. But we will object if Sebi seeks further more time because the matter is so sensitive and already sufficient time has been given by the SC. Sebi also has to investigate the prima-facie suspicions raised by the expert committee,” said advocate Vishal Tiwari, one of the petitioners in the matter.
According to sources, these include Sebi’s findings on alleged stock market manipulation and the modus operandi of certain short sellers.
The apex court had in May granted three months’ time against a request of six months by the markets regulator to complete its investigation into the allegations by the US-based short seller. The three months deadline to submit the report ended today.
Adani group had withdrawn its Rs 20,000 crore follow-on public offer in February.
The apex court had on March 2 asked Sebi to conclude the investigation in two months and file a status report by May 2. In its application submitted on April 29, Sebi requested for more time to ascertain possible violations related to misrepresentation of financials, circumvention of regulations, and fraudulent nature of transactions in respect of 12 suspicious transactions.
Sebi has been investigating possible violations with respect to minimum public shareholding norms, share price manipulations, corporate governance, insider trading, related party transaction disclosures, and regulations concerning FPI and offshore derivative instruments.
As per the report submitted by the committee formed by the Supreme Court, Sebi, in its investigation into possible violations of minimum public shareholding norms, found 42 contributors spread across seven jurisdictions behind the 13 FPIs holding considerable stakes in the Adani group firms.
The markets regulator has been pursuing various avenues to ascertain the ownership pattern of these 42 contributors through assistance from domestic enforcement agencies and overseas regulators.
The SC appointed committee had also pointed out that the enforcement agencies had found evidence of short selling and profiting following the Hindenburg Research report publication on January 24 and are investigating the role of six entities which indulged in short selling.
The committee headed by Justice A M Sapre had observed that even if Sebi was able to get behind the contributing participating shareholders of the FPIs, these contributors could in turn be bodies of other corporate or funds with multiple classes of shareholders, thereby making it difficult to establish the real individuals behind them.
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