As the Supreme Court on 2 March 2023 constituted an ‘expert committee’ to assess the regulatory system in the securities market and make recommendations to strengthen the system, our study of six previous committees over the last two decades revealed that recommendations were ignored in one case; never delivered in one case; never revealed in three cases; and ineffective after creating public unrest in one case.
A 2 March 2023 decision by the Supreme Court of India to create a committee of experts to analyse the regulatory framework in India’s securities market in wake of allegations against the Adani group, has dampened criticism of the government of Prime Minister Narendra Modi and—given the record of previous committees we analysed—may have little impact.
Our analysis of six previous Supreme Court committees revealed that recommendations were ignored in one case; never delivered in one case; never revealed in three cases; and ineffective after creating public unrest in one case.
These six committees, created over the last two decades, had three common attributes—secrecy, ineffectiveness or arbitrary behaviour, according to our analysis, with their approach ranging from the academic to the investigative. The subjects these committees investigated were prison reforms, deforestation, electronic snooping, threats to the independence of the judiciary, grievances of farmers and black money.
The Adani-Hindenburg issue, as it is now called, refers to a 24 January 2023 report published by Hindenburg Research, a US stock-market investor that accused the Adani Group of widespread manipulations and malpractices to inflate its stock prices. The firm accused Adani of “stock manipulation and accounting fraud”, triggering a 60% fall in the group’s market capitalisation over one month from the report’s publication.
The Supreme Court of India ordered the Securities and Exchange Board of India (SEBI), the stock market regulator, to complete its investigation of the Adani-Hindenburg issue within two months.
A bench of Chief Justice of India D Y Chandrachud, Justice P S Narasimha, and Justice J B Pardiwala also constituted an expert committee for “the assessment of the extant regulatory framework (for the securities market) and for making recommendations to strengthen it”.
The committee was asked:
—To provide an overall assessment of the situation including the relevant causal factors which have led to the volatility in the securities market in the recent past.
—To suggest measures to increase investor awareness.
—To investigate whether there was a regulatory framework in dealing with alleged violations of law related to the securities market by the Adani group or other companies.
—To suggest measures to strengthen the statutory framework and regulatory framework and secure compliance with the existing framework for the protection of existing investors.
The committee will be headed by former Supreme Court Justice A M Sapre and includes former Chairman of State Bank of India OP Bhat, former Bombay High Court judge and presiding officer of the Securities Appellate Tribunal J P Devadhar, former chief of the New Development Bank of BRICS countries K V Kamath, co-founder of Infosys Limited Nandan Nilekani, and corporate lawyer Somasekharan Sundaresan.
The court ordered the committee to submit its report “in a sealed cover” within two months and directed all central agencies to cooperate with the committee. It also ordered SEBI to provide “all requisite information to the Committee” and inform the committee of “steps that it has taken in furtherance of its ongoing investigation.”
Here is our account of previous Supreme Court committees and what happened to their findings:
Committee on Prison Reforms
Headed by: Former Supreme Court Justice Amitava Roy
Constituted on: 25 September 2018
Case name: In Re-Inhuman Conditions in 1382 Prisons
Original Deadline: 12 months
Final report: Pending. Delayed by 4 years and 5 months
The case arose from a 2013 letter written by former Chief Justice of India R C Lahoti to the Supreme Court in which he had raised four issues related to 1,382 prisons: overcrowding, unnatural deaths of prisoners, shortage of staff and untrained or inadequately trained staff.
The letter was converted into a suo-motu public interest litigation and was heard for five years until 2018 when the Court constituted a committee to oversee the implementation of its earlier orders and disposed of the case.
The committee did not adhere to the Supreme Court’s 12-month deadline. On 11 March 2022, the Court asked the Justice Roy committee to submit its final report within six months. The case has not been heard since.
“I don’t have to explain the delay to you,” Justice Roy said, when Article 14 sought comment. “It is a matter of record. The report has now been submitted.”
An expert this reporter spoke to expressed her unhappiness with the workings of the committee.
“It did not hear the civil society groups that are focal on bringing out such issues in public,” said Madhurima Dhanuka, a researcher with the Prison Reforms Programme at Commonwealth Human Rights Initiative, an advocacy group. “There were some good orders before the committee was formed. Not much has changed on the ground.”
Central Empowered Committee (CEC) On Deforestation
Committee Members: Member Secretary Amarnatha Shetty, former Indian Forest Service officer Maharaj K Muthoo, advocate Mahendra Vyas, and former chief wildlife warden of Orissa S K Patnaik
Constituted on: 9 May 2002
Case name: T N Godavarman Thirumalpad vs Union of India and Ors
Original Deadline: None
Final report: Periodic Reports
In 1995, one T N Godavarman filed a writ petition in the Supreme Court to protect forests of the Nilgiris from deforestation due to illegal timber operations.
The court on 2 May 2002 constituted a CEC that would provide recommendations and assist the court in ensuring that forest lands are not used for non-forestry purposes.
The CEC came to be known as a “mini-court”, using wide powers delegated by the Supreme Court. An expert we spoke to called it “highly improper” for the court to delegate its powers under Article 32 of the Constitution to a committee. The court created an “extra-statutory” body that held hearings and made recommendations, transgressing judicial functions.
Shomona Khanna, a Supreme Court advocate and former legal advisor to the union ministry for tribal affairs, told Article 14 that the CEC handled a “mammoth number of issues and became a power centre for close to a decade.”
“In 2002, the CEC made a recommendation in its report to remove what it called ‘encroachments’ by Adivasis and forest dwellers from forests and to stop the regularisation of such encroachments by state governments,” said Khanna. “These were forest dwellers whose rights were not recognised under colonial and post-colonial forest laws but the CEC was completely detached from ground realities.”
The CEC’s recommendation led to mass and violent evictions of forest dwellers which led to widespread public protests.
“The main purpose for a CEC—to ensure forest lands were not used for non-forest purposes—has not been served,” said Khanna. “The Supreme Court, taking up an issue as big as managing entire forests and appointing a committee with untrammelled powers created tremendous difficulties for Adivasis and forest dwellers who had no means to challenge any orders or recommendations passed by CEC and access justice.”
The CEC was criticised for the lack of Adivasi representation and of forest-dwelling people. The committee’s five members were mostly wildlife conservationists and forest officials.
India continues to lose forest land to non-forestry projects (here and here).
Pegasus Technical Committee
Headed by: Former Supreme Court Justice R V Raveendran
Constituted on: 27 October 2021
Case name: ML Sharma vs Union of India and others
Original Deadline: “Expeditiously”
Final report: July 2022; related report never released
On 27 October 2021, the Supreme Court after hearing petitions (here and here) filed by journalists and activists seeking an independent probe into illegal hacking and snooping of their electronic devices using an Israeli-made spyware called Pegasus constituted an “independent expert technical committee”, headed by former Supreme Court judge Justice R V Raveendran.
The technical committee was also required to make recommendations “regarding enactment or amendment to existing law and procedures surrounding surveillance and for securing improved right to privacy”.
The committee submitted its final report at the end of July 2022, with the Supreme Court hearing the issue on 25 August 2022.
Reading out some portions of the sealed report, then Chief Justice N V Ramana said that five out of 29 phones produced before the committee were “found to have been infected with some malware”.
“However, it was not clear for the committee if it was Pegasus malware,” said Justice Ramana.
Ramana also revealed that the government of India had “not cooperated with the committee”, despite the court’s order to do so—as in the Adani-Hindenburg case. The court did not criticise the union government.
The committee also produced a separate report with recommendations on “providing legal regime for data privacy and cyber security”. The judges did not release its findings.
Even though the court ordered the matter to be listed after four weeks, no hearings have taken place since.
“Nothing is known,” Jagdeep Chhokar, founding member of the Association for Democratic Reforms, one of the three petitioners in the case, told Article 14. “Nothing could be said about the impact or the outcome of the report since we do not know anything about it.”
Committee To Probe Alleged Conspiracy Against Former Chief Justice Ranjan Gogoi
Headed by: Justice A K Patnaik
Constituted on: 25 April 2019
Case name: In Re: Matter Of Great Public Importance Touching Upon The Independence Of Judiciary
Original Deadline: None
Final report: Never released
In the wake of sexual harassment allegations against then Chief Justice of India Ranjan Gogoi in April 2019, the Supreme Court constituted a one-man investigation committee.
Former Supreme Court Justice A K Patnaik was asked to hold an inquiry into the alleged “conspiracy by fixers and disgruntled employees”—a term used by advocate Utsav Bains who alleged that he was offered Rs 1.5 crore to frame charges against the former Chief Justice.
The Court itself alleged there was a “bigger plot” behind the allegations and that there were attempts to “deactivate the office of CJI” and therefore a threat to the independence of judiciary.
Justice Patnaik submitted his report and the Supreme Court heard the matter on 18 February 2021, after nearly two years. The Court revealed that a conspiracy behind the sexual harassment allegations “cannot be ruled out” but did not explain why it believed this.
Critics pointed out that the committee lacked powers to unravel the facts, by its own admission, and that the court should have “realised that the object of the inquiry could not be achieved from the very beginning”.
The Patnaik report was sealed and never released.
Committee on Farm Laws
Committee Members: National President of Bhartiya Kisan Union Bhupinder Singh Mann (later recused), Agricultural Economist Dr. Parmod Kumar Joshi, Former Chairman of the Commission for Agricultural Costs and Prices Ashok Gulati and President of Shetkari Sanghatana Anil Ghanwat
Constituted on: 12 January 2021
Case name: Rakesh Vaishnav & Ors v Union of India & Ors.
Original Deadline: Two months
Final report: Released, 19 March 2021; never used
Three controversial farm laws enacted by the Narendra Modi government on 27 September 2020 were challenged for their constitutionality before the Supreme Court in December 2020.
Farmers from across Punjab, Haryana, and Uttar Pradesh gathered in large numbers in Delhi to protest the three laws that they alleged would adversely impact farmers and benefit companies.
Then Chief Justice Sharad Arvind Bobde constituted a four-member committee on 12 January 2021 “for the purpose of listening to the grievances of the farmers relating to the farm laws and the views of the government and to make recommendations”.
The committee submitted its final report on 19 March 2021 in a sealed envelope. Though the court did not hear the case again, one of the committee members—Anil Jaysingh Ghanwat, president of the Swatantra Bharat Party and the Shetkari Sanghatana—made the report public.
On the same day the committee was constituted, the Supreme Court also stayed the implementation of the three farm laws as an interim measure. The government repealed the three farm laws 12 months later on 1 December 2021.
The report was never used.
Special Investigative Team (SIT) On Black Money
Committee Members: Former Supreme Court Judges M B Shah and Arijit Pasayat
Constituted on: 4 July 2011
Case name: Ram Jethmalani and others vs. Union of India and others
Original Deadline: Periodic reports
Final report: Never released
In 2009, lawyer Ram Jethmalani filed a petition before the Supreme Court seeking directions for disclosure of “vital documents from the Centre on black money stashed in foreign banks.”
On 4 July 2011, the court constituted a special investigation team to act as a watchdog and monitor investigations into unaccounted or “black” money. The current head of the SIT is retired Supreme Court Judge M B Shah and its vice chairman is Justice Arijit Pasayat.
The committee was tasked with “preparing a comprehensive action plan, including the creation of necessary institutional structures that can enable and strengthen the country’s battle against generation of unaccounted monies, and their stashing away in foreign banks or in various forms domestically”.
The Court ordered the SIT to submit “periodic reports” and “keep this Court informed of all major developments”.
Since then, the committee has submitted over six reports to the Supreme Court in sealed covers. None has been made public, and there has been no hearing since 2015.
The union government rejected a right-to-information application filed by this reporter in May 2021 seeking copies of the recommendations made by the SIT.
Meanwhile, Indian money in Swiss banks rose to a 14-year high in 2021, according to annual data released by Switzerland's central bank.
What’s Ahead For The Adani-Hindenburg Case?
As our analysis showed, most Supreme Court committee reports were not made public.
Critics feared that the order of the Chief Justice’s bench to provide the final report on the Adani-Hindenburg report in a “sealed cover” might similarly take it to a dead end.
Anuj Bhuwania, a lawyer, fellow at SCRIPTS Berlin, a think tank, and author of the 2017 book Courting the People: Public Interest Litigation in Post-Emergency India, told Article 14 that the committee appeared to be “a diversion from the matter”.
“The court could have just stuck to a court-monitored investigation,” said Bhuwania. “Instead, it decides to get into policy and governance matters, especially when constitutional and classic judicial matters remain pending. This committee business is not a particularly important exercise.”
Bhuwania also questioned the issue of “randomness” in appointing members of such committees by the Supreme Court.
“On what basis (were the appointments made)?” said Bhuwania. “If you look at the farm laws committee, it was transparently malafide. There are no criteria and only word-of-mouth leads to appointments to a committee. A committee is to manage political fallout.”
“If they adjudicate and interpret legal and constitutional cases, there will be no problems,” said Chhokar. “But courts try to solve issues, which leads to such committee formation, which ultimately leads to nothing and creates confusion.”
Bhuwania said no good had come from most Supreme Court committees.
“I fear this (Adani case) might go the Pegasus route,” he said. “Instead of looking at the court with undue hope in such matters, just think how much worse they can make it politically. If they don’t make it worse, that is the best possible outcome.”
