The Centre will suggest the remit and members of the expert committee, SC Tushar Mehta told the supreme court today.
The Central government on Monday agreed to the Supreme Court’s suggestion about setting up an expert committee to chart out additional measures needed to safeguard investors from major market volatilities like one triggered by Hindenburg Research.
Hearing a petition for an investigation into the damning report against the Adani Group, the top court on February 10 suggested the government form a panel to examine the fallout of allegations of fraud against the conglomerate.
In response to its suggestion, Solicitor General Tushar Mehta said that the government is not opposed to establishing any committee, though it believes that SEBI (Securities and Exchange Board of India) and other agencies are “fully equipped” to tackle such situations.
“I have instructions that SEBI and other agencies are fully equipped, not only regime-wise but otherwise also to take care of the situation. However, responding to the suggestion which fell from the Court, the government has no objection to constituting a committee,” SC Mehta told the court.
He said that the remit of the committee should be determined carefully because “any unintentional message to international investors or domestic investors that the regulatory authorities need a monitoring by the committee may have some adverse impact on the flow of money”.
SC Mehta – the Centre’s highest law officer – told the court that he could submit the names of committee members in a sealed cover and suggest the remit of the committee.
In turn, Chief Justice of India DY Chandrachud suggested that SG Mehta provides a note on the proposed remit of the committee by Wednesday and posted the matter for the next hearing on Friday.
On the last hearing, the Supreme Court bench headed by CJI Chandrachud and also comprising of Justices PS Narasimha & JB Pardiwala asked the Central government and SEBI to submit by Monday the steps needed to improve statuary and regulatory framework in order to protect investors from market volatility in the future.
The public interest litigation (PIL) was filed by Vishal Tiwari and Manohar Lal Sharma after investors lost crores of rupees in a massive rout in stocks of the Adani Group companies in face of allegations of fraud and stock manipulation.
Gautam Adani – who heads the Adani Group – has lost half of his wealth due to the stock crash. Adani has denied all allegations and decided to sue the US-based activist research firm.