\”Be Careful…\”: Supreme Court To Prashant Bhushan On Hindenburg Allegations

The Supreme Court, contesting calls for an inquiry into allegations against the Adani Group by US short-seller Hindenburg and the Organised Crime and Corruption Reporting Project (OCCRP), stressed that these accusations should not be treated as conclusive. Prashant Bhushan, who petitioned for an investigation into the allegations and action against SEBI for missing its deadline, faced intensive questioning from the Supreme Court.

In the preceding month, an application urged the Supreme Court to look into accusations by OCCRP against the Adani Group, alleging insider trading via two foreign investors. The Adani Group dismissed these allegations as \”recycled,\” asserting it was an attempt by Soros-funded interests, backed by some foreign media, to resurrect the \”meritless Hindenburg report.\”

Tushar Mehta, the Solicitor General of India, apprised the Supreme Court that OCCRP had not shared details with the government but directed them to an NGO linked to Bhushan, revealing a conflict of interest. He emphasized that SEBI dismissed the report as unreliable, considering it from a \”foreign non-profit (NGO).\”

Regarding SEBI surpassing the deadline, Mehta noted that the regulator exceeded it by a mere 10 days. Prashant Bhushan defended his accusation against SEBI, citing a 2014 letter from the Directorate of Revenue Intelligence (DRI) alleging over-invoicing by the Adani Group, which SEBI had not acted upon. The Supreme Court cautioned against unfounded allegations, stressing the necessity for careful consideration.

Bhushan also raised queries about the committee of domain experts appointed by the Supreme Court, but the judges clarified that the members were chosen by the top court, not SEBI. The court challenged Bhushan\’s assertion regarding SEBI\’s inaction on OCCRP reports published in foreign media, underlining that such reports should not be accorded evidentiary value.

The Supreme Court unequivocally stated that SEBI, bound by laws of evidentiary value, cannot rely on newspaper stories. Chief Justice DY Chandrachud reiterated that the Hindenburg report should not be considered the true state of affairs, reaffirming the court\’s directive for SEBI to conduct an investigation.

The Supreme Court-appointed committee\’s May report exonerated the Adani Group, finding no regulatory failure on SEBI\’s part and no price manipulation by the conglomerate. The court underscored that the work of a publication cannot be regarded as the gospel of truth.

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