Winning Bizness Desk

Mumbai.Adani's 5 companies settle SEBI proceedings, pay Rs 1.5 crore over disclosure and audit rule breaches

Adani Group’s five companies have settled legal proceedings with the Securities and Exchange Board of India (SEBI) by paying a combined settlement amount of Rs 1.5 crore. The proceedings were related to alleged violations involving related-party transactions, audits and disclosures in limited review reports.

The settlement orders state that the proceedings stemmed from a SEBI investigation following a January 2023 report by US-based short-selling firm Hindenburg Research, whose operations were later shut down.

SEBI proceedings covered disclosure, audit violations

The case against the companies involved non-disclosure of certain related-party transactions and audit and limited review reports being signed by an audit firm that did not have a valid peer review certificate.

Adani Enterprises Ltd (AEL) was among the companies facing proceedings over these issues.

• AEL was alleged to have not disclosed, in its FY13 annual report, related-party transactions between its subsidiary Adani Estates Pvt Ltd and related party Wakodhar Investment Ltd.
• Its FY15 audit report and the limited review report for the June 2015 quarter were signed by an audit firm without a valid peer review certificate.
• Limited review reports for the June 2017, September 2017 and December 2021 quarters were also signed by an audit firm without a valid peer review certificate.

Four other Adani firms faced similar proceedings

Four other Adani Group companies — Adani Total Gas, AWL Agri Business, Adani Green Energy and Adani Energy Solutions — were also facing proceedings over audit and limited review reports signed by an audit firm that did not hold a valid peer review certificate.

The proceedings therefore covered different instances involving compliance with audit-related requirements applicable to listed companies.

SEBI issued show-cause notices to the companies in February 2024. The notices sought to know why proceedings should not be initiated against them for the alleged violations and why penalties should not be imposed.

Companies proposed settlement without admitting findings

While the proceedings were pending, the Adani Group companies proposed settling the matter. The settlement was made without admitting or denying the findings of fact and the legal consequences arising from them.

Under the settlement process, the companies agreed to pay the specified settlement amount to bring the proceedings to an end.

The total amount paid by the five companies was Rs 1.5 crore.

Settlement terms recommended by SEBI panel

SEBI’s High-Powered Advisory Committee recommended the terms of the settlement in June 2026. The recommendation was subsequently accepted by the panel of whole-time members on August 13.

Following receipt of the settlement amount, SEBI issued formal orders closing the proceedings covered by the settlement.

The settlement orders deal specifically with the compliance-related proceedings and do not amount to an admission of the allegations by the companies.

Proceedings followed Hindenburg report and probe

The SEBI action was based on an investigation that followed the Hindenburg Research report published in January 2023.

The report had made allegations involving several entities, including Adicorp Enterprises, Milestone Tradelinks and Rahvar Infrastructure. It alleged that these companies were used to route funds into Adani Power and Adani Enterprises.

In September 2025, SEBI gave relief to Gautam Adani and the Adani Group in proceedings concerning allegations of stock manipulation. The regulator’s investigation did not find evidence establishing that related parties had been used to route money into the group’s listed companies.

RPT and peer review certificate explained simply

• Related-party transaction (RPT): A transaction between a company and another group company, promoter or a person closely connected to them. Listed companies are required to disclose such transactions to protect shareholders’ interests.
• Peer review certificate: Issued by the Institute of Chartered Accountants of India (ICAI), it indicates that an audit firm has undergone a review of its audit quality practices. Such certification is required for audit firms signing financial statements of listed companies.
• SEBI settlement: A legal mechanism through which a company or individual can settle regulatory proceedings by paying an agreed amount without admitting or denying the findings or legal consequences.

Rs 1.5 crore settlement closes proceedings against five firms

The five Adani Group companies have now settled the SEBI proceedings by paying the combined Rs 1.5 crore amount. The settlement brings the proceedings concerning the specified disclosure and audit-related issues to a close.

The action involved compliance requirements relating to related-party transaction disclosures, audit reports and limited review reports, while the companies did not admit or deny the findings as part of the settlement.