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Jairam Ramesh accuses BJP of misleading on the SEBI investigation of Adani, while himself distorting facts of the case: Read details

Jairam Ramesh gave the impression that the Centre and SEBI are working in cahoots with the Adani Group to shield the Adani Group in light of the allegations made by the controversial Hindenburg report

On Monday, May 15, Congress leader Jairam Ramesh took to social media to accuse the BJP government and the Securities and Exchange Board of India (SEBI) of misleading the people pertaining to the investigation into the Adani Group.

In a tweet (archive), he claimed, “The Minister of State for Finance, Pankaj Chaudhary, told the Lok Sabha on 19th July 2021 that SEBI was investigating the Adani Group. Now SEBI tells the Supreme Court that they have not been investigating any of the serious allegations against Adani!”

“Which is worse—misleading Parliament, or being fast asleep as lakhs of investors are duped by alleged money laundering and round-tripping using offshore shell companies? Or even worse, was there a restraining hand from above?” he further added.

Jairam Ramesh shared the reply of Union Minister of State for Finance, Pankaj Chaudhary, in the Lok Sabha dated July 19, 2021, in response to a question by Trinamool Congress MP regarding Adani group.

Chaudhary had informed [pdf] the House that six companies of the Adani Group were listed on Indian stock exchanges and that some of them were being probed by SEBI and the Directorate of Revenue Intelligence (DRI).

Yes Ma’am. SEBI is investigating some Adani Group companies with regard to compliance with SEBI Regulations. Further, the DRI is investigating certain entities belonging to the Adani Group of Companies under laws administered by it,” he told TMC MP Mahua Moitra.

The Union Minister of State for Finance also informed that the Enforcement Directorate is not carrying out any such investigation. The TMC leader had asked a specific question regarding a probe by SEBI in the issuance of Global Depository Receipt (GDR) of certain Indian-listed companies.

She inquired, “Whether it is a fact that three funds namely Albula Investment Fund Ltd, Cresta Fund Ltd, and APMS Investment Fund Ltd are in the SEBI frozen list of May and 15th June but a clarification is issued by NSDL that these accounts are not frozen in the case of Adani companies and if so, the details thereof?”

At that time, Pankaj Chaudhary said, “SEBI vide Order dated June 16, 2016, had directed depositories to freeze particular beneficiary accounts of certain FPIs including Albula Investment Fund Ltd., Cresta Fund Ltd, and APMS Investment Fund Ltd. However, no Order in respect of other beneficiary accounts of these three FPIs has been passed by SEBI.”

The affidavit filed by SEBI in Supreme Court

On Monday (May 15), the Securities and Exchange Board of India (SEBI) filed a rejoinder affidavit wherein it rubbished allegations that the regulatory body is investigating the Adani Group since 2016.

It said, “The allegation that the Securities and Exchange Board of India is investigating Adani since 2016 is factually baseless. The reliance sought to be placed on the investigation pertaining to GDRs is wholly misplaced.”

SEBI told the Supreme Court that it made the first request to overseas regulators to help investigate the allegations of breach of Minimum Public Shareholding (MPS) norms against the Adani group in October 2020.

“The first request to overseas regulators was made as early as October 6, 2020. A detailed note has been submitted to the expert committee constituted by this court covering the steps taken, responses received and the current status of information gathering under the Multilateral Memorandum of Understanding (MMOU) with the International Organisation of Securities Commissions (IOSCO),” it said in its affidavit.

Jairam Ramesh ignored this particular fact presented by SEBI before the Supreme Court and focused only on the regulatory body’s denial that Adani Group is being investigated since 2016. The Congress leader chose to withhold a key piece of information while accusing SEBI and BJP of lying to the people.

The Missing Context and the 2016 GDR Case

It must be mentioned that SEBI’s affidavit before the apex court was in response to a 2016 investigation against 51 Indian companies and 59 Global Depository Receipt (GDR), which was issued between 2002 and 2014.

Opindia was able to access the order [pdf] dated June 16, 2016, and found that none of the listed companies of Adani Group feature in the list of firms, which were being investigated by SEBI in 2016.

As such, the regulatory body was right when it informed the Supreme Court that the claim about probing Adani Group with respect to the GDR case was ‘totally misplaced’ and ‘baseless.’

This, however, does not contradict the response of Minster Pankaj Chaudhary in 2021, about SEBI and the Directorate of Revenue Intelligence (DRI) investigating the Adani Group “with regard to compliance with SEBI Regulations.”

List of 51 companies investigated by SEBI in 2016
List of 51 companies investigated by SEBI in 2016 (contd.)

This is because the case in that instance was of Foreign Portfolio Investors (FPIs), which is starkly different from the 2016 case of Global Depository Receipt (GDR). In fact, Mahua Moitra’s question specifically mentioned FPIs and not GDR.

The recent affidavit filed by SEBI in Supreme Court about not investigating the Adani Group was in the context of the GDR case, which is quoted out of context by Jairam Ramesh to insinuate that the regulatory body and the BJP government are misleading the people.

In reality, the Congress leader happens to be the one misleading the public by withholding such a key piece of information. He even shrewdly left out the statement of SEBI in the same affidavit about communication with foreign regulators as early as September 2020 for probing companies linked to the Adani Group.

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Dibakar Dutta
Dibakar Dutta
Centre-Right. Political analyst. Assistant Editor @Opindia. Reach me at [email protected]

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