The panel, led by former SC judge Justice A M Sapre, will regulate assessment of the extant regulatory framework and for making recommendations to strengthen the process. The report will be submitted in a sealed cover within 2 months.
The apex court noted it was appropriate to set up such a panel of experts in order to “protect Indian investors against volatility of the kind which has been witnessed in the recent past”.
Seven listed Adani Group companies have since lost about $135 billion since January 24 after a report by US short seller Hindenburg Research accused the Adani Group of improperly using offshore tax havens and manipulating stocks.
Here are the members of SC-appointed panel:
* A M Sapre
The former SC judge has been appointed to oversee the probe that led to crash in Adani Group stocks and other regulatory aspects of the stock market.
Sapre hails from Madhya Pradesh and was elevated to the top court on August 13, 2014. He served till August 27, 2019.
The 68-year-old was initially appointed a judge of the Madhya Pradesh High Court on October 25, 1999 and served there till February 10, 2010. He was then transferred to the Rajasthan High Court, where he remained till March 22, 2013.
He was made the chief justice of the Manipur High Court on March 23, 2013 and remained there till October 18, 2023. Sapre was then appointed the chief justice of the Gauhati High Court, where he served till August 12, 2014 before being elevated to the top court.
* O P Bhatt
A former chairman of the State Bank of India (SBI), O P Bhat is currently a director on the boards of the Oil and Natural Gas Corporation (ONGC), Tata Steel, Tata Motors, TCS and Hindustan Unilever Ltd.
He is also former chairman of the Indian Banks’ Association and held the position for 2010-11. He has served as India’s economic diplomacy as government’s nominee on the India-US CEO Forum, Indo-French CEO Forum and Indo-Russia CEO Forum, forging links with a cross section of the world’s business leaders.
According to reports, SBI broke into Fortune 500 club during Bhatt’s tenure as the bank’s chairman.
* J P Devadhar
A retired judge of the Bombay high court, J P Devadhar is the third member of the SC-appointed expert panel.
Devadhar has served as the presiding officer of the Securities Appellate Tribunal (SAT) and brings immense experience of judging matters related to the stock exchanges.
As per the Bombay HC website, Devadhar has standing Counsel for Income Tax Department since 1985. He has appeared in large numbre of cases in above branches of Law in the Bombay high court, CEGAT, Income Tax Appellate Tribunal, Maharashtra Administrative Tribunal, Central Administrative Tribunal and Supreme Court of India.
* K V Kamath
K V Kamath is a former head of the New Development Bank of BRICS countries. He has also been the chairman of Infosys.
He served as the MD and CEO of ICICI Bank from 1996-2009 and retired from the post in April 2009. Kamath then became the bank’s non-executive chairman.
The veteran banker serves as an independent director on the board of Reliance Industries. He has also been appointed as independent director and non-executive chairman of Jio Financial Services.
Kamath also serves as an independent director on the boards of Houston-based oil services company, Schlumberger, since 2010, and Indian pharmaceutical manufacturer, Lupin.
* Nandan Nilekani
The co-founder and chairman of Infosys, Nandan Nilekani is the fifth member to be elected on the SC-appointed expert panel.
He was the founding chairman of the Unique Identification Authority of India (UIDAI) in the rank of a Cabinet Minister from 2009-2014. Nilekani is considered to be the architect of Aadhaar.
In January 2023, he was appointed as the co- chair of the “G20 Task Force on Digital Public Infrastructure for Economic Transformation, Financial Inclusion and Development”.
Nilekani is also helping the Centre in designing Open Network for Digital Commerce (ONDC) – an e-commerce platform.
* Somasekharan Sundaresan
Lawyer Somasekharan Sundaresan, the sixth member of the panel, is a securities and regulatory expert.
His name was recently recommended to the Centre as a judge of the Bombay High Court. The Supreme Court Collegium later reiterated his name for judgeship after the Centre raised an objection.
The business journalist-turned lawyer is a top expert of securities law, financial sector regulations and competition law.
What will the panel do
The SC-appointed panel will suggest measures to strengthen investor awareness.
The committee will probe whether there was any 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 Justice Sapre panel will be provided assistance by the Centre and other statutory agencies including the Sebi chairperson.
The bench took note of ongoing probe by the Securities and Exchange Board of India(SEBI) and said the market regulator has not expressly referred to an investigation into the alleged violation of the Securities Contracts (Regulation) Rules 1957 which provide for the maintenance of minimum public shareholding in a public limited company.
“Similarly, there may be various other allegations that SEBI must include in its investigation,” it said, directing the SEBI to also investigate whether there was any violation of the Securities Contracts (Regulation) Rules.
What SC said
The top court made it clear that the market regulator can also go beyond its directions with regard to the contours of the ongoing investigation. “SEBI shall expeditiously conclude the investigation within two months and file a status report.”
Dealing with the details of the court-appointed panel, the 9-page order, penned by the CJI, said SEBI shall apprise the expert committee of the action that it has taken in furtherance of the directions during the ongoing investigation.
The setting up of a panel of domain experts does not divest SEBI of its powers or responsibilities in continuing with its investigation into the recent volatility in the securities market, it added.
“In order to protect Indian investors against volatility of the kind which has been witnessed in the recent past, we are of the view that it is appropriate to constitute an Expert Committee for the assessment of the extant regulatory framework and for making recommendations to strengthen it.”
Adani stocks settle higher
Adani Group firms maintained their winning run on Thursday, with all the ten listed entities ending in the positive territory.
Shares of Adani Transmission rallied 5%, Adani Green Energy advanced 4.99%, Adani Wilmar rose 4.99% and Adani Power jumped 4.98%.
Besides, shares of NDTV gained 4.96%, Ambuja Cements (4.94%) and Adani Total Gas (4.41%) on the BSE.
Scrips of Adani Ports climbed 3.5%, Adani Enterprises (2.69%) and ACC (1.50%).
The cumulative market valuation of the ten companies stood at Rs 7.86 lakh crore at the end of trade on Thursday.
How it all started
The row began when Hindenburg Research, a US-base short seller, published a report on January 24 calling the rise of Adani Group as the ‘biggest con in corporate history’.
In the report, Hindenburg accused Adani Group of a “brazen stock manipulation and accounting fraud scheme.” It cited 2 years of research, including talks with former senior executives of the company and reviews of several documents.
The report was released 2 days before Adani Enterprises’ Rs 20,000 crore FPO was about to open. The company had already raised Rs 5,985 crore by allotting shares to anchor investors. The FPO was fully subscribed, however, the market rout in Adani stocks forced the firm to call off the FPO.
Caught in the corporate-cum-stock market storm, Adani Group issued a statement on January 29 against Hindenburg’s allegations few days later and likened the damning allegations to a “calculated attack” on India, its institutions and growth story.
Adani says ‘truth will prevail’
Welcoming the SC decision today, Gautam Adani said the order of a time-bound probe into allegations levelled by Hindenburg Research will bring finality and truth will prevail.
Shortly after a bench headed by Chief Justice D Y Chandrachud passed the order, Adani tweeted: “The Adani Group welcomes the order of the Hon’ble Supreme Court. It will bring finality in a time bound manner. Truth will prevail.”
(With inputs from agencies)