By Arpan Chaturvedi and Aditya Kalra
NEW DELHI (Reuters) – Indian investigators are seeking to reopen the probe into Adani Group over alleged overvaluation of coal imports and have asked the Supreme Court to allow them to collect evidence from Singapore, they say. That the company had thwarted the move for years, legal documents show.
The Directorate of Revenue Intelligence has been trying to obtain transaction documents related to Adani’s transactions from Singapore authorities since 2016. The agency suspects that many of the group’s coal shipments imported from Indonesian suppliers were billed at higher prices on paper, first to its Singapore unit, Adani Global Pte, and then to its Indian branches.
Adani Enterprises, led by billionaire Gautam Adani, and its subsidiaries have successfully mounted repeated legal challenges in India and Singapore to block the release of the documents, court documents show. Adani has denied wrongdoing, saying Indian authorities had assessed the coal shipments before releasing them from ports.
In an October 9 legal filing, which Reuters is reporting for the first time, the revenue intelligence agency asked India’s Supreme Court to vacate a previous lower court order that had given Adani permission to prevent authorities from collecting evidence from Singapore. Permission was given.
Indian officials disputed Adani’s contention that the agency did not follow “due process”, saying in the filing that it had approval to seek information from the Southeast Asian city-state under the Mutual Legal Assistance Treaty.
“Permission to follow this route was obtained from the Ministry of Finance as well as the Ministry of Home Affairs,” the 25-page filing said. It added that the investigation is “fully in compliance”.
In a statement to Reuters, Adani Group said it had “fully cooperated” with authorities by providing details and documents sought more than four years ago and that “no shortcomings or objections” had been pointed out by investigators thereafter. .
The Indian Revenue Agency did not respond to Reuters questions.
The effort to revive the coal probe comes amid broader regulatory scrutiny of Adani since Hindenburg Research in January accused the tycoon and his group of improper use of tax havens and stock manipulation.
Despite Adani’s denial, the short seller’s report caused the group’s shares to fall by $150 billion. The Supreme Court of India is also monitoring the market regulator’s investigation into Hindenburg’s allegations.
Amid and ahead of the results of India’s 2024 elections, political opponents have increased pressure on Prime Minister Narendra Modi’s administration, accusing it of bias towards Adani in government decisions.
Modi and Adani, who are both from Gujarat, have denied inappropriate behaviour.
The revenue agency began looking into Adani’s imports as part of a broader investigation into 40 companies that began in 2014. Investigators alleged that companies importing Indonesian coal were overinvoicing deliveries by showing bills of lading for shipments sent through middlemen in Singapore and elsewhere.
Indian authorities reviewed 1,300 shipments linked to Adani and alleged in court filings that he “grossly inflated” or “artificially inflated” the import price of coal compared to the export price from Indonesia, “money “Charging higher electricity prices in India with the aim of shifting the power to tax havens”.
The sums involved could run into billions of rupees, according to the agency, which did not identify any Indonesian suppliers.
fight in singapore
The evidence India is seeking from Singapore authorities includes documents of Adani’s transactions with 20 banks that could help establish financial leads in the case, a person with direct knowledge of the matter told Reuters.
If India’s Supreme Court grants the agency’s latest request, it will need to seek an order from Singapore’s Court of Appeal to release the material.
A Singapore court last month rejected a Reuters request to inspect related case documents, and said in a written response that the files had been sealed.
But a Reuters review of hundreds of pages of Indian court filings and orders reveals a dispute between India and Adani that has spread from Mumbai to New Delhi and Singapore in recent years.
In 2019, upon Adani’s challenge, the Mumbai High Court cited procedural lapses in rejecting Indian investigators’ request to collect evidence against Adani.
A few days later, the agency appealed to the Supreme Court, which stayed Mumbai’s decision “until further orders”, which the agency later argued in a petition filed in the Supreme Court “may continue the investigation”.
But after Adani’s request in late 2020, a Singapore court said the documents should not be released yet because India’s top court has not reached a final decision, according to two people with direct knowledge of the case and a Reuters review of the legal orders. Is.
In a statement to Reuters, the office of Singapore Attorney-General Lucien Wong said the Singapore court has not given an opinion on the merits of Adani’s appeal and the case is still pending.
The stance taken by Adani’s companies in Singapore “created obstacles” and “stalled” the investigation, the revenue agency told the Supreme Court of India in a 2021 filing.
The case did not go to trial for nearly two years, until the agency told the Supreme Court in July that it wanted to update the judges on certain incidents in Singapore without detailing them. After this, he filed his filing afresh in October to obtain evidence.
The next hearing is to be held on 6 February.
(Reporting by Arpan Chaturvedi and Aditya Kalra; Additional reporting by Sudarshan Vardan in Singapore; Editing by David Crawshaw)