Sebi probe: Maharishi Vedic says not into public deposits

Company says this could be case of 'mistaken identity' and was 'much confused' on what basis Sebi was connecting it with public deposits

As market regulator Securities and Exchange Board of India (Sebi) examines allegations of Maharishi Vedic Construction Corporation collecting money from public investors violating norms, the company claims it has not taken any public deposits.

The company also said this could be a case of “mistaken identity” and it was “much confused” on what basis Sebi  was connecting it with public deposits. The case came to light in a submission made by the   Sebi before its appellate authority with regard to an  Right to Information (RTI) application.

In a response to an RTI plea, the market regulator said “the matter of Maharishi Vedic Construction Corporation Ltd was under examination by Sebi”.

Sebi did not provide any further details sought by the RTI applicant. It was asked to “furnish the information in its possession on examination of which Sebi  has come to conclusion that Maharishi Vedic Construction Corporation Pvt Ltd is involved in the activities of collecting/mobilising monies from general public and mobilisation of such fund/money prima facie appears be in violation of the provisions of Sebi  Act, 1992”.

Sebi, however, said that the matter was under examination and "therefore, disclosure of information may impede the aforesaid proceedings".

Aggrieved by Sebi's response, the applicant moved the Sebi's Appellate Authority, which has also declined to "interfere with the decision of the respondent (Sebi)".

In an order dated February 28 and posted on Sebi website, the Appellate Authority said it agrees with Sebi's views that "disclosure of information prior to completion of examination would be premature to the process of investigation.

"An applicant may wait till completion of examination as the disclosure of any information at any stage prior to such completion may also harm the reputation of parties involved," it added.

After the case became public through this order, the company said in a statement that it "has not taken any public deposits".

"It is a closely held private company and has no activity which involves taking public deposits. If in future we decide to take public deposits, we will take permission under the law from the regulatory authorities.

"We would like to reiterate that we are a law abiding entity. We are very much confused on what basis Sebi is connecting us with public deposits. We feel that this is a mistake or a case of mistaken identity," the company said in a letter signed by one of its directors.