Review Petition Challenges Supreme Court's Refusal to Interfere in Adani Stock Probe

In a legal twist, a review petition has been filed challenging the recent Supreme Court judgment that declined intervention in the Securities and Exchange Board of India's (SEBI) investigation into the Adani Group's stock price drop following the Hindenburg Research report. The application, filed by petitioner Anamika Jaiswal, contends that the verdict contains "apparent errors" and introduces new material highlighting Adani Group's potential violation of securities rules.

The petition states, "There are mistakes and errors apparent on the face of the impugned judgment/order dated 03.01.2024 and in light of certain new material that has been received... the Petitioner respectfully submits that there are sufficient reasons which require a review of the impugned order."

The petitioner emphasizes a potential breach of Rule 19A of the Securities Contracts (Regulation) Rules of 1957 by the Adani Group, stating that private listed companies must maintain a minimum public shareholding of 25 percent. The plea asserts that the court overlooked the aspect of Adani promoters investing in Adani group stocks and calls for a thorough investigation.

The Supreme Court, in its January 2024 judgment, refused to issue directions or interfere with SEBI's investigation, stating limited power to enter SEBI's regulatory domain. The court held no regulatory failure by SEBI and asserted that market regulators can't operate based solely on press reports.

The Hindenburg Research report accused Adani of share price inflation, causing a significant drop in share value. Despite pleas alleging regulatory contraventions, the Supreme Court formed a committee headed by retired Justice AM Sapre. The committee found no prima facie lapse by SEBI. Petitioners raised concerns of conflict of interest, citing relationships between SEBI Committee members and the Adani family. However, the court rejected these contentions, allowing SEBI to proceed with the investigation.

The review petition challenges the court's findings and introduces fresh material, signaling an ongoing legal battle over the Adani stock controversy.

Author: Anushka Taraniya

News Writer, MIT ADT University