New Delhi, [Date]: Indian investigators are pressing to reinitiate a probe into the Adani Group, focusing on the alleged overvaluation of coal imports. Legal documents reveal that authorities have approached the Supreme Court, seeking permission to gather evidence from Singapore, a step they claim the company has impeded for years.
The Directorate of Revenue Intelligence (DRI) has been pursuing transaction documents related to Adani’s dealings since 2016, suspecting that coal shipments from Indonesian suppliers to Adani’s Singapore unit, Adani Global Pte, and then to its Indian arms involved overbilling. Adani Enterprises, led by billionaire Gautam Adani, has successfully challenged these efforts in both Indian and Singaporean courts, consistently blocking the release of documents.
In a legal filing dated October 9, which Reuters is reporting for the first time, the DRI requested the Supreme Court to overturn a previous lower court order that allowed Adani to prevent authorities from collecting evidence in Singapore.
Adani denies any wrongdoing, asserting that Indian authorities had assessed its coal shipments before releasing them from ports. However, the revenue intelligence agency argues in its filing that it had approval to seek information from Singapore under a mutual legal assistance treaty, countering Adani’s claims of not following “due process.”
“Permission for following this route was obtained from the Ministry of Finance as well as (the) Ministry of Home Affairs,” the filing states, emphasizing the investigation’s compliance with legal processes.
Adani Group responded, stating that it had cooperated fully with authorities, providing requested details and documents over four years ago, and that investigators had not communicated any deficiency or objection thereafter.
This renewed effort to probe Adani’s coal imports occurs amid increased regulatory scrutiny of the conglomerate since Hindenburg Research accused Adani and his group of improper use of tax havens and stock manipulation in January. Adani’s denials notwithstanding, this report triggered a significant drop in the group’s stocks.
In the midst of the fallout and with an eye on the 2024 election, political opponents have accused Prime Minister Narendra Modi’s administration of favoritism towards Adani in government decisions. Both Modi and Adani deny any impropriety.
The investigation into Adani’s coal imports originated in 2014 as part of a broader inquiry into 40 companies. Indian authorities allege that companies importing Indonesian coal, including Adani, overstated or artificially inflated the import value compared to the export value from Indonesia. The investigation aims to uncover potential fund diversion to tax havens and higher power prices in India.
The evidence sought from Singapore authorities, including transaction documents from 20 of Adani’s banks, is seen as crucial in establishing a financial trail for the case. If the Supreme Court allows the agency’s request, the next step would be to seek an order from Singapore’s Court of Appeal to release the material.
While Adani has successfully challenged previous attempts by Indian authorities, the ongoing legal tussle highlights the complexity and international dimension of the investigation.