Cong slams SEBI's probe into Adani matter, says India's institutions are 'failing its people'

The Congress on Friday hit out at market regulator SEBI over its investigation against the Adani Group, alleging that India's institutions are 'failing' its people under the Modi government and asserting that only a JPC could bring out the truth in the matter.

The opposition party has been questioning the financial dealings of billionaire Gautam Adani's Group after US research firm Hindenburg alleged 'irregularities' and charged it with stock price manipulation. The Adani Group has denied all the allegations made in the Hindenburg report and claimed there had been no wrongdoing on its part.

Congress general secretary Jairam Ramesh's attack came after a media report claimed that the SEBI is likely to tell the Supreme Court that the Adani inquiry began in 2014, but hit a dead end.

Sharing the media report on X, Ramesh said that after first having 'attempted to hide' the fact that it had initiated an investigation against the Adani Group in 2014, it appears that market regulator SEBI will tell the Supreme Court why it paused the investigation in 2017 before being forced to restart it again in 2020.

"Reportedly, SEBI will tell the Supreme Court that 'the initial investigation did not yield anything'," he claimed.

"Let us recall the sequence of events that SEBI singularly failed to unravel: The Directorate of Revenue Intelligence (DRI) in 2014 had investigated the over-invoicing of power-generation equipment by the Adani Group that siphoned off an alleged USD 1 billion in funds. The proceeds of this scam were handled by two Vinod Adani associates, Chang Chung-Ling and Nasser Ali Shaban Ahli, via companies based in Mauritius and the UAE.

"It subsequently emerged that the same duo had set up two investment funds in Mauritius — Emerging India Focus Fund (EIFF) and EM Resurgent Fund (EMRF) — that funnelled major investments into Adani Group shares," he said.

By June 2016, the funds held 8-14 per cent of 'benami' holdings in Adani Enterprises, Adani Ports and Special Economic Zone, Adani Power and Adani Transmission via shell companies in Mauritius, UAE and British Virgin Islands, Ramesh alleged.

"How was such a clear-cut and brazen violation of laws relating to round tripping and minimum public shareholding allowed to escape scrutiny? Why was a comprehensive DRI investigation that had already laid out the key facts ignored? What were the pressures put on SEBI to give Adani a clean chit?," he said.

Is it a coincidence that all this occurred during the SEBI chairmanship of UK Sinha who later became a director in an Adani-owned channel, Ramesh asked.

"India’s institutions are failing its people under the Modi government. The truth of the Modani scam will only be revealed by a Joint Parliamentary Committee," he asserted.