Plea in Supreme Court seeks probe into post-poll market crash

An application has been filed before the Supreme Court, urging the Union Government and the Securities and Exchange Board of India (SEBI) to disclose a detailed report on the share market crash and the consequent losses incurred by investors following the Lok Sabha 2024 poll results.

The application, filed by Advocate Vishal Tiwari as an interlocutory application in the ongoing Adani-Hindenburg case, comes after the apex court's earlier directive to the government and SEBI to consider recommendations from an expert committee aimed at fortifying the regulatory framework and safeguarding the interests of Indian investors.

In January, the Supreme Court had instructed SEBI and investigative agencies to probe whether the losses sustained by Indian investors due to the actions of Hindenburg Research and other entities engaged in short-selling activities amounted to any legal infraction, and if so, to take appropriate action.

Tiwari's application raises concerns over the lack of transparency regarding SEBI's compliance with the court order and the submission of any records related to the investigations.

"The public and investors who suffered losses have the right to know whether the Indian stock market crashed after the Hindenburg report due to irregularities and violations by any corporate group, causing substantial losses to public money," the application reads. "The results of SEBI's investigations in this respect should be placed on record to prevent things from remaining hidden and buried."

Through this application, Tiwari has sought compliance with the court's direction, urging SEBI to submit the investigation report in the Adani-Hindenburg matter.

Citing media reports, Tiwari highlighted that a significant crash in the share market, with losses nearly amounting to 20 lakh crores, was observed after the Lok Sabha poll 2024 results.

The application states that this incident has once again raised questions about the regulatory mechanisms of the stock exchange. It mentions that despite the court's alarming direction after the losses suffered in 2023, the same issues have been repeated, and nothing has changed. It is noted that after the announcement of exit polls regarding the Lok Sabha 2024 results, the share market soared, but when the actual results were announced, it resulted in a market crash.