Corporate Affairs Ministry reviews Adani Group’s financial statements: Sources

The inspection process of the ministry was initiated on February 2, 2023 under “Section 206” of the Companies Act of India. , Photo Credit: Reuters

Two senior government officials told Reuters on February 3 that the corporate affairs ministry has begun a preliminary review of Adani Group’s financial statements and other regulatory submissions made over the years.

The ministry’s review is the latest probe into the Adani group, but the first by the government.

The new ministry inspection process was launched on February 2, said one of the government sources, under “Section 206” of India’s Companies Act, under which the government reviews financial documents accumulated over the years, such as that the balance sheet, books of accounts or ledger.

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“An investigation has been launched by the Director General of Corporate Affairs (A). The ministry is closely monitoring the situation and will take appropriate steps in time,” the first senior government official with direct knowledge of the proceedings told Reuters.

A spokesperson for the Adani Group did not immediately respond to a request for comment. The Ministry of Corporate Affairs, as well as the Office of the Director General, did not respond to requests for comment by Reuters.

A second government source confirmed that the process has been initiated and will involve looking into the company’s corporate governance practices, but declined to elaborate.

Due to the confidential nature of the process, government officials declined to be named.

The Section 206 legal provision under the Companies Act also empowers the government to seek more documents from a company if it deems necessary, such as minutes of meetings or board resolutions, said two other sources familiar with the process.