VISHAL TIWARI Vs. UNION OF INDIA

JUDGEMENT

(1.) A batch of writ petitions filed before this Court under Article 32 of the Constitution in February 2023, raised concerns over the precipitate decline in investor wealth and volatility in the share market due to a fall in the share prices of the Adani Group of Companies ("Adani group"). The situation was purportedly caused by a report which was published on 24/1/2023 by an "activist short seller", Hindenburg Research about the financial transactions of the Adani group. The report inter alia alleged that the Adani group manipulated its share prices and failed to disclose transactions with related parties and other relevant information in violation of the regulations framed by SEBI and provisions of securities' legislation. Significantly, the report expressly states that Hindenburg Research took a short position in the Adani group through US-traded bonds and non- Indian traded derivative instruments.

(2.) A brief overview of the petitions follows:

(3.) When the batch came up for hearing on 10/2/2023, this Court noted that there was a need to review the existing regulatory mechanisms in the financial sector to ensure that they are strengthened with a view to protect Indian investors from market volatility. This Court sought inputs from the Solicitor General on the proposed constitution of an Expert Committee for the purpose. This Court observed: