SAT quashes Sebi's order banning Tree House Education and Accessories, its officials

The Securities Appellate Tribunal (SAT) on Thursday set aside markets regulator Sebi's order banning Tree House Education and Accessories and its officials from securities market in a matter related to alleged misstatement of financials of the firm.

Rajesh Bhatia, Geeta Bhatia, Giridharilal S Bhatia and Hiten Trivedi are the officials from whom the ban is lifted.

"However, we uphold the direction relating to forensic audit of Tree House. Appellants shall extend full cooperation to enable the auditor to complete the forensic audit at the earliest," the tribunal said.

Taking cognisance of several media reports alleging irregularities in functioning and operations of Tree House in December 2016, Sebi had initiated an investigation for the period from April 1, 2011 to June 30, 2017.

In an interim order passed in March 2018, the regulator had banned the company and its officials from the securities market till further orders. Sebi confirmed its directions through an order in November 2018.

However, SAT said that "an ex parte interim order is required to be passed in order to curb further mischief or to stop large scale exercise of possible mischief of tampering with the securities market."
In this regard, SAT noted "as on date, nothing has been shown on record to indicate any finding through interim audit report with regard to the manipulation of books of account or siphoning off the funds of the company. The forensic audit is still underway."