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Sunday, December 3, 2023

Centre agrees to SC monitored committee in Adani-Hindenburg issue


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New Delhi: The Centre on Monday agreed for a committee which will examine the existing regime and regulator’s role in preventing meltdown situation of shares, as happened to Adani, after Hindeburg Research report, but it stressed that the SC could choose the composition of experts committee from names suggested by the Centre.

The Solicitor General (SG) Tushar Mehta, senior law officer appearing for the UOI (Union of India) told the Supreme Court that the SEBI is competent to handle the Hindenburg Report fallout. The Centre agreed before the Supreme Court that the SC may constitute a committee to protect investor interests and requested it to that the SC should consider the names/members for the committee, as suggested by it to deal with the issue.

Mehta also said that the composition would be in such a manner made, it doesn’t affect the flow of money and investments.

The Supreme Court bench, headed by the Chief Justice of India (CJI) Dr Dhananjaya Yeshwant Chadrachud, asked the Centre to submit a note on the proposed terms of reference by Wednesday, and fixed the matter for further hearing on February 17, Friday.

A petition has been filed before the Supreme Court by Manohar Lal Sharma seeking directions to Securities and Exchange Board of India (SEBI) and the Union Home Ministry to conduct a thorough probe and register a First Information Report (FIR) against founder of Hindenburg Research, Nathan Anderson, and his associates in India for “exploiting innocent investors”, of its recent report on Adani Group.

The petition of Sharma, filed before the Supreme Court, said that Anderson and his associates in India hatched an alleged criminal conspiracy by short selling Adani stocks in hundreds of billion dollars before ‘concocting’ a research report related to the Adani Group in order to crash the stock market and square up their short sell position at the lowest rate.

Sharma’s petition, filed before the Apex Court sought directions to conduct an enquiry to prosecute and register an FIR against Anderson and his associates under sections 420 (Cheating) and 120-B (Criminal Conspiracy) of the Indian Penal Code (IPC) for ‘exploiting innocent investors via short selling under the garb of artificial crashing via short selling’.

“They secured billions of profits by butchering citizen of India. However, SEBI did not suspend trading in the stock specially qua to the Adani group of the companies and allowed short sellers to exploit innocent investors,” the plea of Sharma said.

He also sought recovery of Anderson’s alleged turnover with penalty to compensate investors in the interest of justice.

Sharma also prayed to the Supreme Court for a declaration that short selling is an offence of fraud against the investors to be prosecuted under section 420 of the IPC read with section 15-HA (Penalty for fraudulent and unfair trade practices) of SEBI Act.

Another petition was filed by lawyer Vishal Tiwari before the Supreme Court on the same Hindenburg Research report.


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