The Securities and Exchange Board of India (SEBI) on Tuesday settled adjudication proceedings against five Adani firms over alleged disclosure and audit compliance violations after receiving settlement payments totalling Rs 1.50 crore.
The companies settled the proceedings without admitting or denying the findings of fact and conclusions of law, according to the regulator’s September 22 settlement order.
The five firms are Adani Enterprises, Adani Total Gas, AWL Agri Business, formerly Adani Wilmar, Adani Green Energy and Adani Energy Solutions, formerly Adani Transmission. Adani Enterprises paid Rs 76.05 lakh and Adani Green Energy paid Rs 45.50 lakh. Adani Total Gas, AWL Agri Business and Adani Energy Solutions paid Rs 9.75 lakh each, the order said.
Disclosure and audit allegations
The proceedings followed SEBI’s examination of allegations concerning related-party transaction disclosures and corporate governance issues highlighted in the Hindenburg report. The regulator examined possible violations of its listing regulations and the erstwhile equity listing agreement.
According to the order, SEBI issued a show-cause notice to the five companies on February 15, 2024. The allegations covered undisclosed related-party transactions involving Adani Enterprises and audit or limited review reports signed by firms without valid peer review certificates.
SEBI alleged that transactions between Adani Estates, an Adani Enterprises subsidiary and Vakoder Investment, a related party of Adani Enterprises, were not disclosed in the company’s FY2013 annual report as required by the applicable accounting standard.
The notice also alleged that Adani Enterprises’ audit report for the year ended March 2015 and limited review report for June 2015 were signed by Dharmesh Parikh & Co LLP without a valid peer review certificate.
Similar allegations involved Shah Dhandharia & Co LLP’s signing of Adani Enterprises’ limited review reports for June 2017, September 2017 and December 2021, and the December 2021 reports of Adani Total Gas and AWL Agri Business.
For Adani Green Energy, the alleged lapses concerned its March 2019 annual audit and limited reviews for September 2018, December 2018 and June 2019. Adani Energy Solutions’ June 2015 limited review was also cited. These reports were signed by Dharmesh Parikh & Co LLP, the order said.
Settlement terms approved
The companies proposed revised settlement terms on May 29, 2026. SEBI’s High Powered Advisory Committee recommended the terms on June 29 and a panel of whole-time members accepted them on August 13.
A demand notice was issued on August 20. The companies informed SEBI on September 5 that they had remitted the amounts, and the order records that the regulator had received the full settlement payments.
The order disposed of the pending adjudication proceedings with immediate effect. It retained the right to restore or initiate proceedings if representations proved untrue, undertakings were breached or discrepancies emerged in determining the settlement terms.