SUPREME COURT ACTION IN ADANI CASE
The Supreme Court had asked the GOI to set up an expert panel and check on the safety of the investors in situations like Adani Stock Manipulation. The Government of India prepared suggestions on what can be done during such cases and what existing provisions led to the issue. However, the suggestions were submitted in a sealed envelope. Meaning, the SC or any other body cannot reveal or read the contents. SC rejected this as the suggestions came in sealed envelopes. The Apex court is to set up its own committee now.
Contents
• What is the sealed cover procedure in India?
• Background
• What did the SC do?
What is the sealed cover procedure in India?
When a sealed cover is provided, it shall be opened only during acquittal. That is, SC can now open the cover only when Gautham Adani is acquitted.
Background
The financial research company Hindenburg released a report on the Adani Group. According to the report, the Adani group has fraudulently increased its stock prices in India. Gautham Adani and his cousins showcased a rise in revenue of their shell companies set up in several countries. While in reality, no operations were actually happening in these shell companies. The stock manipulation put the reputation of India at stake. So, the SC stepped in accepting a Public Interest Litigation on the issue.
What did the SC do?
According to the apex court, a lot of investors lost their money in stock manipulation fraud. What safety features do you as the Ruling Government possess to protect the investors in such cases? was SC’s Question. Two days’ time was given. GOI replied that the existing provisions are enough and satisfactory to protect the investors in such cases. But if SC wished it can set up a committee to look into the matter. SC asked the central government to create a panel and provide a report on these safeguard provisions. Now, GOI put the suggestions made by the expert panel in a sealed cover.
POINTS TO REMEMBER:
Legality Under Sealed Cover Jurisprudence
Indian law does not explicitly specify the usage of sealed covers, but the Supreme court has the authority to apply it pursuant to section 123 of the Indian Evidence Act,1872 and Rule 7 of Order XIII of the Supreme Court Rules.
Rule 7 of Order XIII of the Supreme Court Rules
According to the rule, if the Chief Justice or court decides certain information to be provided under sealed cover or considers it to be strictly confidential, no party would be permitted to view the contents of that information, unless the Chief Justice himself orders that the opposing party be permitted to access it. Additionally, it states that information may be kept private if its disclosure is believed not to be in the interest of the public.
Section 123 of the Indian Evidence Act, 1872
This act protects official, unpublished papers pertaining to the affairs of the state and prohibits public officials from being forced to reveal them.
Other situations in which information may be requested in confidence include those in which its disclosure may jeopardize an ongoing investigation, such as when it pertains to matters included in a police case diary.