 "Adani")
In an application submitted to the Supreme Court, the Securities and Exchange Board of India (Sebi) has sought a fortnight’s time to submit its investigation 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 capital markets regulator in the application to the Supreme Court, adding that substantial work had been done.
The regulator has submitted it has completed its investigation in one matter and prepared an interim report based on the material that could be gathered till now.
Sebi added it had sought information from foreign agencies and regulators and upon receiving it, it would decide on the further course of action.
“Out of the remaining six matters, in four investigations/examinations, findings have been crystalized and the reports prepared consequent thereto are in the process of approval by the Competent Authority,” said Sebi in its submission.
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The watchdog said it expected to complete the approval process in the four matters before August 29, the scheduled date for hearing in the Supreme Court.
However, investigation in one of these remaining two matters is at an advanced stage while an interim report is under preparation.
“We would have no objection if Sebi submits its report in the next 15 days. But we will object if Sebi seeks more time because the matter is sensitive and already sufficient time has been given by the court. Sebi 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, the findings could be on the alleged circumvention of minimum public shareholding, alleged stock market manipulation and the modus operandi of certain short sellers.
The apex court had in May granted the committee three months as against a request of six months by the regulator to complete its investigation into the allegations by US-based short-seller Hindenberg Research against Adani Group. The deadline to submit the report ended on Monday.
Adani Group had withdrawn its Rs. 20,000 crore follow-on public offer in February.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 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 foreign portfolio investors (FPIs) and offshore derivative instruments.
According to 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 Adani Group firms.
The regulator has been pursuing various avenues to ascertain the ownership patterns of these 42 contributors through assistance from domestic enforcement agencies and overseas regulators.
The committee had pointed out enforcement agencies had found evidence of short-selling and profiting following the Hindenburg Research report publication on January 24 and was investigating the role of the 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 be bodies of other companies or funds with multiple classes of shareholders, thereby making it difficult to establish who were behind them.
