NEW DELHI: “Let there be some alacrity,” Supreme Court said while it proposed to grant market regulator SEBI (Securities and Exchange Board) three months for completing the probe in the Adani-Hindenburg saga.
A bench of CJI DY Chandrachud, Justices PS Narasimha and JB Pardiwala said that the court would pass orders on SEBI's application on Monday after perusing the report of the court-appointed expert committee headed by Justice AM Sapre.
"To now extend 6 months time may not be appropriate and we will extend the time for three months cause they have a point saying that SEBI was already investigating," CJI said.
The CJI during the hearing also rapped a counsel who was levelling allegations against SEBI for regulatory failure.
“We have asked the committee to enquire if there is any regulatory failure. How can you say that? Don’t just stand up and levy allegations against the regulator. Whatever you argue here affects the volatility of the stock market,” the CJI said.
In an attempt to convince the bench to extend the time for six months, SG Tushar Mehta said, “We have narrated the facts and it requires us 6 months more. We have reached a particular stage and for reaching any conclusion we need 6 months more. 6 months is the minimum time required.”
Objecting to the time sought, Advocate Prashant Bhushan said, “SEBI was investigating some of these transactions as far back in 2016 which is more than 6 years ago. SEBI is a partner of an International Corporate organisation on IOSCO (The International Organization of Securities Commissions) under the treaty of this organisation. SEBI is governing board and tax haven countries are members of this organisation. They can seek any information and secrecy will prevent any member country from giving the information sought.
Laying emphasis on the “complexity involved in the matter,” SEBI in the application had said, “Keeping in view the forgoing circumstances, it would take further time to arrive at verified findings and conclude the investigation referred to herein above. SEBI also respectfully submits that for ascertaining possible violations related to misrepresentation of financials, circumvention of Regulations and/or fraudulent nature of transactions in respect of 12 suspicious transactions given the complexity of the matter, SEBI in the normal course would take at least 15 months for completion of the investigation of these transactions, but is making all reasonable endeavours to conclude the same within six months.”
SEBI in respect of 12 suspicious transactions pertaining to misrepresentation of financials, circumvention of Regulations and fraudulent nature of transactions has said that it has noted prima facie that “these are complex” and “have many sub transactions” which thus require rigorous investigation.
It has said that investigations into possible violations of related party transactions disclosure, Corporate Governance related matters, Minimum Public Shareholding norms, FPI regulations, ODI norms, insider trading regulations, norms of short selling and share proof manipulation would require further time.
SEBI has also told SC that it may require to depose “key managerial persons” from the seven listed Adani companies before the investigation into the allegations made by Hindenburg can be concluded. It has also stated that prima facie findings have been shared with the expert committee.
“Investigation would also require obtaining bank statements from multiple domestic as well as international banks and as the bank statements would also be for the transactions undertaken more than 10 years ago, this would take time and be challenging. SEBI further submits that this process of seeking bank statements from the offshore banks would entail taking assistance from offshore regulators, which may be time-consuming and challenging,” the application stated.