New Delhi [India], February 3 (ANI): Claiming Hindenburg Research has "exploited innocent investors", a public interest litigation was filed in the Supreme Court today seeking probe against the US-based firm, whose report has led to shares of Adani group plunging on the bourses.

The PIL by a lawyer sought an inquiry to prosecute short sellers Nathan Anderson, a resident of US, and his Indian entities. The plea also sought to register an FIR against Anderson and his associates for exploiting and duping lakhs of innocent investors.

In the "interest of justice," ML Sharma also seeks compensation for investors who suffered losses due to a crash in stock price.

Nathan Anderson is the founder of Hindenburg Research which published a report last week, leading to a huge dent on the Adani Group firms' assets.

The plea sought an "inquiry to prosecute and register FIR (first information report) under section 420 and 120-B of IPC (India Penal Code) read with Section 15HA SEBI Act against the short sellers (Anderson and his associates in India /USA) for exploiting innocent investors."The plea alleged that Anderson and his Indian entities, hatched a criminal conspiracy and thereafter on January 25, 2023, they released a concocted news as research report which was damaging to the Adani Group of companies. It added when the share market crashed, they squared up their short sell position at the lowest rate.

According to the plea, the short sellers "secured billions of profits by swindling" many citizens of India.

However, Securities and Exchange Board of India (SEBI) did not suspend trading in the stock exchanges, which particularly dragged down the shares of Adani Group of companies and allowed short sellers to exploit innocent investors, the petitioner also alleged.

In the petition, ML Sharma has prayed, "Be pleased to issue writ of mandamus to the Respondents to conduct inquiry to prosecute and register F.I.R. u/s 420 and 120-B of IPC read with Section 15HA SEBI Act against the short sellers (Anderson and his associates in India /USA) for exploiting innocent investors via short selling under the garb of artificial crashing via short selling couple with further direction to recover their turnover of short selling with a penalty to compensate investors in the interest of justice."The petitioner has also urged to declare short selling as an offence of fraud and that the investors to be prosecuted under Section 420 of IPC, and Section 15HA of SEBI Act 1992."The petitioner said he has raised various constitutional questions, which is needed to be decided.

The first question raised by the petitioner was whether SEBI is not duty-bound to suspend trading in the short selling stock to protect investors and whether intentionally short selling to crash stock in share market to square up via crashing market value via concocted artificial means is not a fraud punishable under section 420120-B of IPC read with Section 15HA Sebi Act 1992, the petitioner said. (ANI)