In Brief
Following a sharp decline in Adani Group share prices after a January 2023 Hindenburg Research report alleging financial misconduct, investors filed petitions seeking a court-monitored investigation and revocation of SEBI's regulatory amendments. The Supreme Court upheld SEBI's regulatory framework and investigative authority. The Court held that judicial review of specialized regulatory policies is limited to testing constitutionality and manifest arbitrariness, not wisdom. SEBI's 22 completed investigations into the Group showed no regulatory failure. The Court rejected pleas to transfer investigations to the CBI or a Special Investigation Team, finding no evidence of willful inaction. It dismissed conflict-of-interest allegations against Expert Committee members as unsubstantiated and directed SEBI to complete pending investigations within three months, while directing the Government and SEBI to consider Expert Committee recommendations on strengthening investor protection frameworks.
The lawyer headnote and full judgment text are available to registered users.