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Synopsis

The Delhi High Court has issued directions to the Directorate of Revenue Intelligence (DRI) and the Central Bureau of Investigation (CBI) to thoroughly and promptly investigate allegations of over-invoicing by power companies affiliated with the Adani Group, Essar Group, and others.

The order was delivered by a division bench comprising Justices Suresh Kumar Kait and Neena Bansal Krishna in response to public interest litigation (PIL) petitions filed by activist Harsh Mander and the NGOs Centre for Public Interest Litigation and Common Cause.

"In the peculiar facts of these cases, this Court finds it appropriate to direct the respondents to meticulously and expeditiously look into the allegations of the petitioners to unearth the actual factual position and take appropriate actions against the erring companies, if any, as per law," it said. 

Court instructed the authorities to delve into the allegations and uncover the factual position, emphasizing that appropriate actions should be taken against any companies found to be at fault.

The order was issued while disposing of the PILs, filed in 2017, which sought the constitution of a Special Investigation Team (SIT) under a retired Supreme Court judge to probe the allegations.

The petitioners leaned on show cause notices from the DRI, dated May 15, 2014, and March 31, 2016, indicating that entities within the Adani and Essar groups were allegedly inflating the value of imported goods to divert funds abroad from publicly listed companies with low or zero duty rates.

During the proceedings, the petitioners presented reports from Hindenburg Research (January 24, 2023) and OCCRP to assert that the Adani Group's promoters were involved in manipulating the stock prices of their listed companies.

The DRI informed the court that the investigation was divided into multiple cases, citing the complex and time-consuming nature of the process, which involved various stages and multiple countries.

The CBI reported that it had registered two cases and that investigations were ongoing.

While the court observed that transparent processes govern the determination of tariff rates through bidding under Central Government guidelines, it directed the authorities to expeditiously address the allegations due to the petitioners' grievances over inaction and various pending proceedings in other forums.

The court's directions conclude the matter, disposing of the PILs.

Case Title: Centre for Public Interest Litigation and Anr. v. Union of India and Ors.