Good news for Gautam Adani, Rajesh Adani as Bombay HC grants relief in cheating case worth Rs 3880000000

The Bombay High Court has cleared Adani Group chairman Gautam Adani and managing director Rajesh Adani of allegations in a Rs 388 crore case related to the Ketan Parekh stock market scam. The Serious Fraud Investigation Office (SFIO) had accused them of stock manipulation and financial misconduct.

The ruling was given by Justice R.N. Laddha, who overturned a 2019 sessions court order that had reinstated charges against the Adanis. The detailed judgment is yet to be released.

Background of the Case
The case started as part of a government-led investigation into Triumph Security Ltd, a firm accused of market manipulation. The SFIO alleged that the Adani Group provided funds and shares to companies linked to Ketan Parekh, the stockbroker at the center of the 1998-2001 stock market scam.

According to SFIO’s findings:

Parekh’s network made Rs 151.40 crore through Adani-related stock transactions.
Adani Group’s promoters allegedly earned Rs 388.11 crore unfairly.
Investors and stakeholders faced a total loss of Rs 540 crore.

Legal Timeline

2012: SFIO filed a chargesheet against Adani Enterprises Ltd and 12 individuals, including Gautam and Rajesh Adani, accusing them of fraud.
2014: A magistrate court dropped charges against the Adanis, citing a lack of direct evidence.
2015: SFIO challenged the ruling in a sessions court.
2019: The sessions court reinstated the charges, arguing the magistrate’s court had made an error. The Adanis appealed this decision.
March 2024: The Bombay High Court quashed the 2019 ruling, clearing the Adanis of all charges.

The Ketan Parekh Stock Market Scam

Ketan Parekh was a well-known stockbroker who manipulated the stock market using a strategy called circular trading. He borrowed large sums of money from banks, mainly Madhavpura Mercantile Cooperative Bank, and invested heavily in select stocks, which became known as K-10 stocks. This led to an artificial rise in stock prices.

When the scam was exposed in 2001, it caused a major stock market crash, leading to huge losses for investors. Following investigations by SEBI, Parekh was convicted in 2008 and banned from trading for 14 years.

Final Verdict
With the Bombay High Court’s ruling, the Adani Group has been officially cleared in this case. This decision marks the end of a long legal battle and removes a major controversy surrounding Gautam and Rajesh Adani. However, further details will be available once the court's final judgment is released.