While deciding on two complaints filed by different individuals based on a report by US-based short-seller Hindenburg Research, anti-corruption ombudsman Lokpal says the complaints alleging impropriety and conflict of interest against Madhabi Puri Buch, chairperson of the Securities & Exchange Board of India (SEBI), 'falls short' of persuading it to order any probe. While Lokpal did not provide the name of the first complainant, the second complaint was filed by Mahua Moitra, a member of Parliament (MP) from Trinamool Congress.
In the order, the Lokpal full bench headed by justice AM Khanwilkar, former judge of the Supreme Court, says the complaint filed by Ms Moitra "falls short of persuading us to take a firm view that there exists a prima facie case as per Section 20 of the (Lokpal) Act of 2013 to proceed in the matter including to direct a preliminary inquiry or investigation, for the same reasons and logic spelt out (in the first complaint) hitherto."
Lokpal asked both the complainants, including the Trinamool Congress MP, to file affidavits mentioning details of the efforts they made to verify the authenticity and credibility of the claims in the recent report of Hindenburg Research published on 10 August 2024.
It also asked them to articulate the allegations against the person concerned, which may constitute an offence of corruption within the ambit of the Prevention of Corruption Act, 1988, 'provision wise'.
Without mentioning the name of the first complainant, the Lokpal says the complaint was drafted on 13 July 2024 but may have been improvised on 30 August 2024 based on the recent report by Hindenburg Research.
"From the chronology, we have reason to believe that the (first) complainant, without verifying the contents of the stated report and collating credible material, has rushed in his complaint on the same day online," the order says.
Ms Moitra, the MP, filed her complaint on 11 September 2024 and placed it in the public domain. However, the Lokpal says, "It is common knowledge that the entire copy of this communication (sent by the MP) was contemporaneously placed in the public domain (in media) despite the mandate of Rule 4 of the Lokpal (Complaint) Rules, 2020, guaranteeing protection of identity not only of the complainant but also to the public servant complained against till the conclusion of the inquiry of investigation."
"Moreover, the complainant (Ms Moitra) must clarify as to how the act of private investment made by the named public servant that too before taking over the office as XXXX of SEBI and/or as XXXX would attract the offence of corruption under the Prevention of Corruption (PC) Act. Furthermore, how the activities prior to the period specified in Section 53 of the PC Act be reckoned and inquired/investigated into by the Lokpal," the order says.
The bench also referred to orders issued by the Supreme Court in the Hindenburg Research, SEBI and Adani matter. Earlier, certain writ petitions were filed with the SC seeking an independent investigation into the allegations in the short-seller's report (SSR).
During the proceedings, the SC observed that SEBI was investigating the matter. The SC also constituted an expert committee to investigate and suggest measures to strengthen existing laws and regulations. It also directed SEBI to consider certain additional aspects of its scope. On 6 May 2023, the expert committee submitted its report, finding no regulatory failure with respect to applicable laws and regulations. SEBI also concluded its investigations in 22 of the 24 matters as per the status report dated 25 August 2023 to the SC.
On 3 January 2024, the apex court disposed of all matters in various petitions, including those relating to separate independent investigations concerning the allegations in the Hindenburg report.
Noting that SEBI has completed the investigation in 20 out of 22 matters, the SC says, "Taking into account the assurance of the solicitor general, we direct SEBI to complete the investigation in the other two cases within three months.
"Reliance on newspaper reports and third-party organisations to question the statutory regulator does not inspire confidence. They can be treated as inputs but not conclusive evidence to doubt the SEBI probe. This court has not interfered with the outcome of the investigations by SEBI, which should take its investigation to its logical conclusion in accordance with the law. The facts of this case do not warrant a transfer of investigation from SEBI," held a bench presided over by chief justice Dr DY Chandrachud. (
Read: Adani-Hindenburg Row: SC Rejects SIT Probe, Says Media Reports Not Conclusive Proof)
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