Delhi High Court orders CBI, DRI to expeditiously look into allegations of over-invoicing by Adani and Essar groups

The Delhi High Court on Tuesday ordered the Directorate of Revenue Intelligence (DRI) and the Central Bureau of Investigation (CBI) to “meticulously and expeditiously” look into the allegations of over-invoicing by power companies belonging to the Adani Group, Essar Group and others [Centre for Public Interest Litigation and Anr v Union of India and Ors]..A Division Bench of Justices Suresh Kumar Kait and Mini Pushkarna asked the authorities to “unearth actual factual position” and “take appropriate action” as per law against the erring companies."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 actual factual position and take appropriate actions against the erring companies, if any, as per law," the Court ordered..The directions were issued while disposing of public interest litigation petitions (PILs) filed by activist Harsh Mander and NGOs Centre for Public Interest Litigation and Common Cause.The petitions were filed in the year 2017 and sought the constitution of a Special Investigation Team (SIT) under a retired Supreme Court judge to investigate the allegations.The petitioners relied on the show cause notices dated May 15, 2014 and March 31, 2016 issued by DRI stating that the intelligence had indicated that various entities of Adani group and Essar Group were indulging in gross over-valuation of imported goods (zero or low duty rated) to siphon off money abroad from public listed companies.During the arguments of the case, the petitioners relied on the Hindenburg Research Report dated January 24, 2023 and the OCCRP report to submit that the promoters of Adani Group were engaged in manipulation of stock prices of their listed companies. .The DRI told the Court that the investigation has been divided into multiple cases but due to the voluminous nature of cases, involving several stages and multiple countries, the process of investigation is extremely time consuming and complicated.At the time of final hearing, DRI presented some documents to show that cases are pending against various companies including those under the Adani and Essar Group.The CBI said that it has registered two cases and the investigation in them is still going on..After considering the case, the Court noted that as far as allegations regarding inflated tariff rates are concerned, they are determined through a transparent process of bidding under the guidelines of the Central Government and therefore, on this count no interference is required.On the issue of SIT probe, the Court observed that as the petitioners are aggrieved by the inaction on part of respondent authorities and because a number of proceedings are pending before several other forums, it is appropriate to direct the authorities to expeditiously look into the allegations.With these directions, the Court disposed of the plea..Advocates Prashant Bhushan, Neha Rathi, Kajal Giri, Sarim Naved, Saurabh Sagar and Harsh Kumar appeared for Centre for Public Interest Litigation, Common Cause and Harsh Mander.Advocates Farman Ali and Usha Jamnal represented the Union of India.DRI was represented through its Senior Standing Counsel Aditya Singla as well as advocates Charu Sharma and SA Rabde.Special Public Prosecutor Nikhil Goel along with advocates Siddhi Gupta and Adithya Koshy Roy appeared for the CBI..[Read Judgment]