Adani row: SEBI disagrees with expert panel, says will take action if any violation found
New Delhi, Jul 10: Capital markets regulator SEBI on Monday told the Supreme Court that its 2019 rule changes do not make it tougher to identify beneficiaries of offshore funds, and action will be taken if any violation is found or established.
SEBI said it has continuously tightened rules concerning beneficial ownership and related-party transactions - key aspects in the allegations of Adani Group manipulating its stock price.
A Supreme Court-appointed expert committee had in an interim report in May stated that it saw "no evident pattern of manipulation" in billionaire Gautam Adani's companies and there was no regulatory failure.
It, however, cited several amendments the Securities and Exchange Board of India (SEBI) made between 2014-2019 that constrained regulators' ability to investigate, and its probe into alleged violation in money flows from offshore entities has "drawn a blank".
Without making any mention of the status report of its own investigation into allegations against Adani Group, SEBI in its latest affidavit to the Supreme Court said it did not agree with the expert committee observation of difficulties in identifying holders of economic interest behind an offshore fund.
It also differed with the panel observation that stocks will re-price if the markets feel actions taken in the past by the company were not desirable, saying even if the market may re-price the stocks of the company based on the past transactions, "there is no bar on SEBI to examine any securities laws violations because re-pricing of the stock has happened."
SEBI indicated it does not agree with the expert committee's views and action will be taken if any violation is found/established.
After a report of US short-seller Hindenburg Research alleging accounting fraud, stock market manipulation and improper use of offshore entities by Adani Group stirred a political row and triggered a rout in the conglomerate's stocks, dethroning Adani as the world's third richest man, the Supreme Court had on March 2 constituted the expert committee to investigate if there was any failure to disclose transactions with related parties and if stock prices were manipulated.
The committee was to work in parallel with the probe by Sebi into offshore entities investing in the Adani Group. The regulator was first asked to complete the probe in two months and then given another three months till August 14.
In the affidavit, SEBI said its 2019 rule changes in fact "tightened the disclosure requirement" related to beneficial owners.
In its 43-page filing, SEBI opposed the expert committee's recommendation that a firm timeline for the regulator to complete its investigation must be "embedded into the law", saying prescribing such limits "may compromise the quality of investigation", create constraints and increase litigation.
A bench headed by Chief Justice D Y Chandrachud is scheduled to hear the ongoing Adani-Hindenburg case on Tuesday.
In the affidavit, SEBI has given its views on the recommendations by the expert committee on issues like effective enforcement policy, judicial discipline, robust settlement policy, necessary timelines, surveillance and market administration measures, creation of financial redress agency and others.
"Prescribing timelines for initiation of investigation and proceedings may not be appropriate as the Board is mandated to form a prima-facie opinion (reasonable grounds) to appoint an investigating authority," it said.
"Further, the nature, scope and complexity of cases in the securities market vary significantly, and 'reasonable time' to complete investigation would depend on the facts of each specific case and availability of information. Therefore, prescribing specific timelines to complete the investigation may compromise the quality of the investigation," the SEBI said.
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Cong govt ended ‘darkness’ in 11 months of rule in T’gana: CM Revanth Reddy rebuts PM Modi's remark
Hyderabad (PTI): During the last 11 months, the Congress government in Telangana has reversed an air of gloom and despair under the previous BRS regime and ended the "darkness", Chief Minister A Revanth Reddy said on Saturday.
He was responding to a post by Prime Minister Narendra Modi that under Congress rule developmental trajectory and fiscal health is turning from bad to worse in Himachal Pradesh, Karnataka and Telangana.
“I am happy to clarify several misconceptions and factual errors in your statements about my state and our government," Reddy said in his post.
Prime Minister Narendra Modi Friday in a series of posts said the Congress stands "badly exposed" in front of people for promising to them what the party knows it will never be able to deliver.
“Every promise made by us to people is a sacred commitment for us. In the last 11 months, we have reversed an air of gloom & despair under BRS, and ended the darkness. Like a morning sun, Telangana is now Rising,” Reddy said in the post addressed to Modi.
Within two days of taking charge, the Telangana government fulfilled its first and second promise - free bus travel for women across all government buses, and a healthcare and hospitalisation cover of 10 lakhs under Rajiv Aarogyasree, the CM pointed out.
Even before completion of first year of rule, the Congress government has implemented India's largest ever, state-level farmer loan waiver of Rs 18,000 crore covering over 22 lakh farmers, he said responding to PM’s comments that in Telangana, farmers are awaiting the (loan) waiver they were promised.
Women get free electricity, with no domestic power charge for their homes up to 200 units, Reddy noted.
The CM also claimed that his government has held the largest recruitment drive and is regularly holding exams of all levels and provided jobs to over 50,000 eligible youth, a record “unmatched by any BJP state government.”
The CM said the government is rejuvenating River Musi, which was allegedly neglected by the previous government and protecting lakes and other precious water bodies, encroached upon and destroyed wantonly with abandon in the last 10 years.
