Centre Transfers US SEC Summons for Gautam Adani to Gujarat Court: Report

The Centre has forwarded a summons from the US Securities and Exchange Commission (SEC) to a court in Gujarat for serving on industrialist Gautam Adani in connection with a bribery case, The Hindu reported. The newspaper cited an internal note from the Ministry of Law and Justice, dated February 25, which was sent to a sessions court.

According to the report, the summons was issued by the SEC and forwarded in February through the Hague Convention following a request from the US Central Authority. The government note reviewed by the publication stated: "We may, if approved, forward the documents to the District & Sessions Court, Ahmedabad, Gujarat, for effecting service upon the respondent."

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Allegations Against Gautam Adani

The SEC has accused Gautam Adani and his nephew, Sagar Adani, of orchestrating a bribery scheme worth hundreds of millions of dollars, allegedly paying Indian government officials to secure commitments for purchasing energy at above-market rates. The US regulator’s website also mentioned that Cyril Cabanes, an executive at Azure Power, was charged for his role in the extensive bribery scheme.

According to the allegations, the scheme involved manipulating contracts and regulatory approvals to benefit Adani Green Energy and Azure Power at the expense of fair market competition. The SEC claims that bribes were funneled through intermediaries and offshore accounts to conceal the payments, thereby violating anti-corruption laws in both India and the United States.

The SEC further stated that Adani Green Energy raised over $175 million from US investors, while Azure Power’s stock was traded on the New York Stock Exchange (NYSE), bringing the case under the jurisdiction of US financial regulators. The allegations have sparked concerns among global investors, as both companies are significant players in India's renewable energy sector.

International Legal Implications

The summons being forwarded under the Hague Convention is a significant development, as it enables international legal cooperation in serving judicial documents across borders. This means Indian courts are now required to facilitate the process, potentially increasing legal scrutiny of Adani Group’s business practices on a global scale.

Legal experts believe this case could set a precedent for multinational corporations operating in India, particularly in sectors with heavy government involvement such as energy and infrastructure. The SEC’s involvement suggests that US regulators are closely monitoring companies raising capital from American investors, especially when allegations of financial misconduct and bribery are involved.

The Indian government’s response to the summons will be closely watched, as it could impact diplomatic and economic relations between India and the US. If Adani and other executives are required to respond to legal proceedings in the US, it could pose significant challenges for the conglomerate, which has major projects in multiple sectors, including ports, energy, and infrastructure.

Adani Group’s Response

So far, Adani Group has not issued an official statement regarding the SEC’s allegations. However, sources close to the company suggest that legal teams are reviewing the matter and preparing a defense against the charges. The conglomerate has faced scrutiny in the past, including accusations of stock manipulation and corporate governance concerns raised by the Hindenburg Research report in early 2023.

Industry analysts believe the impact of these allegations could extend beyond legal consequences. Investor confidence in Adani Group has already been affected by past controversies, and further scrutiny by US regulators may lead to increased volatility in stock prices. Additionally, any potential sanctions or penalties imposed by the SEC could hinder future fundraising efforts in global financial markets.

Broader Impact on India’s Energy Sector

The case also raises questions about the transparency and accountability of India’s renewable energy sector, which has attracted significant foreign investment in recent years. With ambitious targets for expanding clean energy infrastructure, India has been a key player in global climate initiatives. However, allegations of corruption could undermine investor trust and complicate efforts to secure funding for sustainable energy projects.

The coming weeks will be critical as legal proceedings unfold. If the summons is successfully served, Gautam Adani and other individuals named in the case may be required to provide testimony or respond to charges in US courts. Meanwhile, regulatory agencies in India may also launch their own investigations to assess whether any domestic laws were violated.

As the situation develops, both legal and financial experts will be closely monitoring its impact on India’s corporate governance landscape and international business relations.