Shares of Sammaan Capital witnessed a dramatic decline of nearly 9% on Wednesday, November 19, following strong criticism from the Supreme Court of India regarding the investigative approach in an ongoing probe involving the company.
Supreme Court's Strong Rebuke to Investigative Agencies
The apex court expressed serious concerns about what it termed as a "friendly approach" adopted by investigative agencies in the Sammaan Capital case. The bench specifically called out the Central Bureau of Investigation (CBI), Ministry of Corporate Affairs (MCA), and the Securities and Exchange Board of India (SEBI) for their perceived reluctance and inconsistency in handling the matter.
The court observed that the agencies' stance raised significant questions about both the pace and seriousness of the investigation, particularly given the nature of the allegations involved. The bench emphasized that the case involves alleged financial misdoings and potential harm to investors, making the need for prompt and decisive action even more critical.
SEBI's 'Double Standards' Flagged by Court
In a significant development, the Supreme Court took serious note of SEBI's reluctance to take action in the matter. The bench explicitly called out what it described as "double standards" in the market regulator's approach to the case.
While granting SEBI jurisdiction to investigate the matter, the court stated there was no justifiable reason for the regulatory body to delay action. The strong observations indicate the court's determination to ensure that regulatory bodies maintain consistent standards in dealing with financial irregularities, regardless of the entities involved.
CBI Directed to File FIR to Strengthen ED Probe
The Supreme Court pressed the CBI to file a First Information Report (FIR) in the case, noting that a formal complaint would significantly strengthen the Enforcement Directorate's ability to pursue the money laundering angle of the investigation.
The court has sought a clear response from the CBI regarding its stance on the matter, specifically questioning why the agency had not proceeded with filing an FIR despite the seriousness of the allegations. This direction from the apex court is expected to accelerate the investigative process.
During court proceedings, the ED informed the bench that it would conduct a joint meeting with the CBI, SEBI, and the Serious Fraud Investigation Office (SFIO) within the next two weeks. This coordinated effort aims to align investigative approaches and ensure comprehensive coverage of all aspects of the case.
The ED further revealed that complaints filed with Economic Offences Wings in both Delhi and Mumbai had not received proper attention, which contributed to delays in coordinated action and overall investigative momentum.
Next Hearing Scheduled and Market Impact
The Supreme Court has scheduled the next hearing in this significant matter for December 17. By this date, the court expects clear updates from all involved agencies—CBI, ED, SEBI, and SFIO—regarding the status of the investigation, considerations around FIR filing, and progress in inter-agency coordination.
The court's strong observations signal a tightening of judicial scrutiny on the Sammaan Capital investigation. Regulatory and enforcement bodies are now required to justify their decisions and demonstrate credible progress in the coming weeks. The immediate market reaction saw Sammaan Capital's stock price drop sharply, reflecting investor concerns about the potential implications of the court's intervention and the intensified scrutiny on the company's operations.
This development marks a crucial moment in corporate governance and regulatory enforcement in India, with the Supreme Court taking a proactive stance to ensure that financial investigations proceed with the required seriousness and urgency.
