The Adani Saga: Brothers-In-Arms?

The Adani Group has repeatedly brushed aside questions about Vinod Adani, Gautam Adani’s brother, claiming that he is not involved with the Adani Group in any management or decision-making capacity and that he is not a related party.

The Adani Group had announced on 16 September 2022 that ‘the Adani Family, through Endeavour Trade and Investment Ltd, a special purpose vehicle, had successfully completed the acquisition of Ambuja Cements Ltd and ACC Ltd’. It has been reported that a SEBI filing stated, ‘the ultimate beneficial ownership of the Acquirer is held by Mr. Vinod Shantilal Adani and Mrs. Ranjanben Vinod Adani.’

If Vinod Adani is not a part of the Adani Group, how have Adani Enterprises executives become senior managers at Ambuja Cements and ACC? Why does the Competition Commission of India assert that Endeavour ‘belongs to the Adani Group’?

Media reports suggest that the shell company Acropolis Trade and Investment owns Xcent Trade and Investment, which in turn owns Endeavour. The Mauritius-based Acropolis and Xcent both have Subir Mittra— who heads the Adani Family Office—as a director. Vinod Adani is a director in Acropolis, which reported $7 billion (Rs 51,400 crore) as revenue and profit (given near-zero expenses) in 2020-21 but zero income and a $25,980 loss in 2021-22.

How does a shell company that owns these critical infrastructure firms have revenues of Rs 51,400 crore in one year and zero the next?

Endeavour acquired stakes in Ambuja Cements and ACC by buying Holderind Investments from the previous owner. Holderind lists Mittra as a director and Rogers Capital Corporate Services as the management company.

One of Rogers’ directors, Jayechund Jingree, is a former director in Adani Enterprises (then named Adani Exports) and is also connected to five investment funds that were anchor investors in Adani Enterprises’ ill-fated Rs 20,000 crore FPO. Jingree is also reportedly connected with fugitive stockbrokers Ketan Parekh and Dharmesh Doshi.

A sixth Mauritius-based fund that invested as an anchor investor, The Great International Tusker Fund, also has directors who are co-directors with Vinod Adani and Subir Mittra in other firms. This is suggestive of a network of group executives involved in money-laundering and round-tripping.

In a 13 March 2023 Lok Sabha reply, the minister of state for finance stated that an investigation into alleged over-invoicing by the Adani Group of imported Indonesian coal, conducted by India’s premier anti-smuggling agency, the Directorate of Revenue Intelligence (DRI), had “not reached finality as information sought from exporting countries through execution of Letters Rogatory is under litigation”.

In 2016, the DRI had alleged that 40 Indian companies including Adani Enterprises, Adani Power, Adani Wilmar, Adani Power Maharashtra and Adani Power, Rajasthan were over-invoicing imported Indonesian coal with the goal of “siphoning-off money abroad” and in order “to avail higher power tariff compensation based on artificially inflated cost of the imported coal”.

This was done through intermediaries in Singapore, Hong Kong, Dubai and the British Virgin Islands. Despite a Supreme Court order in January 2020 to proceed with the inquiry, the DRI told the Bombay High Court in June 2021 that Adani Enterprises was trying to “impede” the probe by challenging “well settled procedure of issuance of Letter Rogatory” sent to courts in Singapore, Dubai, Hong Kong, Switzerland and Indonesia. The investigation seems to have reached a dead end.

In the same reply on 13 March, the minister informed that the DRI had concluded its investigation into imports of power equipment by the Adani Group and submitted a report “before the relevant judicial authorities”. It is worth recalling that in 2014, DRI had discovered three Adani Group companies— Maharashtra Eastern Grid Power Transmission, Adani Power Maharashtra, and Adani Power Rajasthan—had paid the Dubai-based Electrogen Infra FZE Rs 9,048 crore for power equipment imported from China and South Korea, which were actually worth Rs 3,580 crore.

Electrogen was controlled by Vinod Adani via the Mauritius-based Electrogen Infra Holding. Why has it taken more than eight years for this investigation to be completed? Will the DRI make its potentially damning contents public?

A third DRI investigation that has gone nowhere is a 2004–2006 diamond scam in which Gautam Adani’s younger brother and his brother-in-law were accused of circular trading of diamonds and fraudulently claiming export subsidies. In 2013, the Commissioner of Customs fined both of them as well as Adani Enterprises and five diamond trading companies linked to the Adani Group. However, in 2015, the Customs, Excise and Service Tax Appellate Tribunal set aside the Commissioner’s order and dismissed the findings. Why did the DRI not appeal against the tribunal’s order?