The much-awaited verdict of the Supreme Court in the Adani vs Hindenburg case, which had snowballed into a major political controversy and wiped off billions of dollars of investor wealth, has positive read-throughs for Gautam Adani as well as those betting on the business acumen of the college dropout.
“By and large, a clean chit has been given to the Adani Group. The court has also restored Sebi’s credibility and the ball is now in the regulator’s court,” Advocate Sumit Agrawal of Regstreet Law Advisors told ETMarkets.
Adani stocks rallied up to 10% with Adani Energy Solutions and Adani Total Gas leading the show as the conglomerate’s market capitalisation crossed the Rs 15 lakh crore mark once again.
Key takeaways from Supreme Court verdict in Adani Hindenburg case:
1) While delivering the verdict, a Supreme Court bench headed by Chief Justice DY Chandrachud, said there is no ground for transferring the case to an SIT, CBI or any other agency.
“The facts of this case do not warrant a transfer of investigation from SEBI. In an appropriate case, this court does have the power to transfer an investigation being carried out by an authorised agency to an SIT or to the CBI. Such a power is exercised in extraordinary circumstances…,” the bench said.
2) The apex court has also restored Sebi’s credibility which was questioned by some political parties. “They have agreed to Sebi’s process which is a very positive takeaway for me as an ex-Sebi official,” Advocate PR Ramesh said.
CJI also observed that the power of the court to enter the regulatory domain of Sebi in framing delegated legislation was limited.
3) “The court has completely rejected the report by the Organised Crime and Corruption Reporting Project (OCCRP). Any third party report without verification is rejected with a caveat that if only verifiable documents are provided then only it can be relied upon,” Agrawal said while commenting on the ruling.
4) While noting that Sebi has completed 22 out of the 24 investigations into the allegations levelled against the Adani Group, the court asked the regulator to complete its probe into two pending cases within 3 months. “The court is not going to be interfering into Sebi’s investigation as it is going on the right track,” Agrawal said.
5) The judgment further said that the government and the SEBI should look into infractions of the law, if any, by Hindenburg on short-selling and take suitable actions.
“The government should also investigate because there was a knee-jerk reaction in the market. The fall was not caused by the Adani group. Somebody hammered the market. The government may leave the investigation to Sebi,” Ramesh said.
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