Supreme Court: Hindenburg report not taken as verified statement.
Hindenburg Research report should not be regarded as an inherently truthful statement. The Supreme Court stated
During the hearing of a petition regarding the factual disclosures made in the Hindenburg report, the Supreme Court emphasized that the Hindenburg Research report should not be regarded as an inherently truthful statement. The court stated, "We don't have to treat the Hindenburg report as being a statement of truth," clarifying its position on the report's credibility.
The court noted that there is no way to independently verify the accuracy of the Hindenburg report, leading to its directive for the Securities and Exchange Board of India (SEBI) to investigate the matter. The petitioners raised concerns about the suspicious nature of SEBI's actions, claiming that the regulator had possession of details since 2014, shared by the Directorate of Revenue Intelligence (DRI).
During the hearing, SEBI informed the court that it had sought key documents from the Organized Crime and Corruption Reporting Project (OCCRP), but they were denied. The petitioners alleged that SEBI had completed investigation reports but had not disclosed them. In response, the court questioned whether SEBI could be compelled to disclose findings before initiating legal proceedings and expressed reluctance to prejudge SEBI's findings.
The petitioners suggested the appointment of a court-appointed Special Investigation Team (SIT), but the Supreme Court sought concrete evidence to doubt the integrity of SEBI's probe. The court also cautioned against accepting journalistic reports as gospel truth and questioned SEBI's inability to access certain documents over the years.
The case revolves around the Hindenburg Research report, published in January, which accused the Adani Group of accounting fraud and stock price manipulation. The report triggered a significant decline in the stock market, prompting SEBI to investigate the matter. The Adani Group has vehemently denied the allegations, describing Hindenburg Research as an "unethical short seller" and labeling the report as a deliberate attempt to tarnish its reputation and manipulate stock prices.