The Supreme Court on Friday refused to accept the Centre's suggestion in a sealed cover on the panel of experts to strengthen regulatory measures for stock market while hearing the Adani-Hindenburg case. The top court reserved its order on the issue related to appointing the committee.
Chief Justice of India DY Chandrachud said if the names suggested by the Centre were not given to the other party, there would be lack of transparency. The court said that it would pass orders to constitute an expert committee.
"We will select the experts and maintain full transparency. If we take names from the government, it would amount to a government constituted committee. There has to be full (public) confidence in the committee," CJI Chandrachud said, as per a Live Law report.
CJI also observed during the hearing, "We can't start with a presumption of regulatory failure".
READ | Adani Row: Govt Agrees To Panel To Strengthen Regulatory Regime To Protect Investors
The suggestion on the names of committee members and their powers were submitted in a sealed cover by Solicitor General Tushar Mehta, representing SEBI.
"We want the truth to come out, but it should not affect the market. The court can take a decision on assigning supervision to a former judge," SG Mehta said.
The stocks of Adani Group have taken a beating since US short-seller Hindenburg Research accused it of stock manipulation and accounting fraud. The Adani Group has denied any wrongdoing and has threatened to sue Hindenburg.
In its previous hearing, the Supreme Court had said Indian investors had suffered losses running into several lakh crores and suggested formation of a committee of domain experts to put in place robust practices to protect investors.
In the next hearing, the Centre informed the Supreme Court that it was agreeable to the suggestion to form an expert committee to review the regulatory framework.
However, Solicitor General Mehta requested that the remit of the committee should be defined in such a manner so as to not give an impression to foreign and domestic investors that there are inadequacies in the regulatory framework.
The bench then asked the petitioners to present their points of view.
Advocate Vishal Tiwari, who filed a PIL, sought the constitution of a committee under the head of a retired Supreme Court judge to investigate the contents of the Hindeburg Research report.
On the other hand, advocate ML Sharma sought to declare 'short-selling' as the offence of fraud.