Investigative body, SEBI, has exonerated Gautam Adani and related companies from the accusations made by Hindenburg Research.
The Securities and Exchange Board of India (Sebi) has dismissed allegations of related party dealings against eight Adani Group entities, including Group chairman Gautam Adani. The order was passed by Sebi whole time member Kamlesh C. Varshney on Thursday.
The transactions in question occurred during the financial years 2018-19 to 2022-23. However, the transactions were not considered related party transactions due to the timing and the 2021 amendment to the Listing Obligations and Disclosure Requirements (LODR) regulations. The 2021 amendment to the LODR regulations was effective from a prospective date of April 1, 2022, and provided a glide path till April 1, 2023. As a result, the amendments did not apply to the transactions in question as they occurred before the effective date of the amendment.
Hindenburg Research, in a report published on January 24, 2023, had alleged that Adani Enterprises and Adani Power Mundra were funded by Milestone Tradelinks and Rehvar Infrastructure through Adani Infra (India) in FY 2020-21. However, Sebi could not establish the allegations against these entities. The specific individuals who financed Milestone Tradelinks and Rehvar Infrastructure in transactions between Adani Group companies from FY 2018-19 to FY 2022-23 are not publicly disclosed in available records.
The Sebi order held that there was no violation of provisions of the Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market (PFUTP) regulation by the entities in question. The order further stated that there was no allegation or evidence of fraud in the case. The transactions were found to be in compliance with the provisions of the LODR Regulations, and were not manipulative or fraudulent.
It's important to note that this new investigation is not related to the Sebi order regarding the Adani Group entities. The order also mentioned that the amount involved in the transactions returned with interest before the start of the investigation.
Meanwhile, the Chhattisgarh Police has begun an investigation into the authenticity of a fresh peace talks offer from Maoists. The details of this investigation are still unfolding and will be reported separately.
The entities dismissed include Gautam Adani, Rajesh Adani, group CFO Jugeshinder Singh, Adani Enterprises, Adani Ports & Special Economic, Adani Power, Milestone Tradelinks, and Rehvar Infrastructure. The order is a significant relief for the Adani Group, which has been under scrutiny in recent months.
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