NEW DELHI: The SEBI on Monday refuted the allegation before the Supreme Court that it has been investigating the Adani group of companies since 2016, as "factually baseless".
In an affidavit, the market regulator told the court its previous investigation related to Global Depository Receipts has got no relation and/or connection to the issues referred to and/or arising out of the Hindenburg Report.
The said investigations were conducted against 51 Indian listed companies. However, no listed company of Adani Group was part of the said 51 companies. After the completion of investigation, appropriate enforcement actions were taken in this matter, the SEBI said in an affidavit.
"Hence, the allegation that SEBI is investigating Adani since 2016 is factually baseless. I, therefore, say and submit that reliance sought to be placed on the investigation pertaining to GDRs is wholly misplaced," an affidavit filed by Satyansh Maurya, working as Assistant Manager, Securities and Exchange Board of India, stated.
The court, which was scheduled to consider SEBI's plea for further six months time to complete the probe on Monday, fixed the matter for hearing for Tuesday.
As per the March 2 order, the SEBI has been investigating into charges of "accounting fraud" and "brazen stock manipulation" against Adani group of companies as brought out in US short seller firm Hindenburg report on January 25. The Adani group, which suffered massive losses after the report, denied all the changes.
In a rejoinder affidavit, the SEBI stated so far as investigation/examination relating to 12 transactions referred to in the Hindenburg Report was concerned, prima facie it is noted that these transactions are highly complex and have many sub transactions across numerous jurisdictions.
"A rigorous investigation of these transactions would require collation of data/information from various sources including bank statements from multiple domestic as well as international banks, financial statements of onshore and offshore entities involved in the transactions and contracts and agreements, if any, entered between the entities along with other supporting documents. Thereafter, analysis would have to be conducted on the documents received from various sources before conclusive findings can be arrived at," it said.
SEBI also said that its application for extension of time is meant to ensure carriage of justice keeping in mind the interest of investors and the securities market since any incorrect or premature conclusion of the case arrived at without full facts material on record would not serve the ends of justice and hence would be legally untenable.
"It would be just, expedient and in the interest of justice that the application for extension of time be allowed," it said.
The affidavit also said, "In the context of investigation into Minimum Public Shareholding norms, SEBI has already approached eleven overseas Regulators under the Multilateral Memorandum of Understanding with International Organisation of Securities Commissions. Various requests for information were made to these Regulators. The first request to overseas Regulators was made as early as on October 6, 2020."
Earlier, on May 12, the court had said it may grant additional time of three months instead of six months to complete the probe by SEBI.
On April 29, the SEBI moved the court seeking six-months extension of time for the purpose.
“For ascertaining possible violations related to mis-representation 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,” it had said.
The court had on March 2 also set up a committee headed by the top court's retired judge Justice Abhay Manohar Sapre to investigate if there has been regulatory failure in dealing with the alleged contravention of laws pertaining to the securities market in relation to the Adani Group or other companies.
The court's order had then come on a clutch of PILs filed by advocate Vishal Tiwari and others. The Justice Sapre committee had submitted its report to the court.