Capital markets regulator Sebi on Wednesday imposed a total penalty of Rs 66 lakh on 10 entities, including Jalan Cement Works Ltd, in a case related to misrepresentation in the company's financial details.
In addition, the Securities and Exchange Board of India (Sebi) has barred the entities from the capital markets for periods ranging from six months to one year.
In its 69-page order, the regulator found that Jalan Cement Works Ltd (JCWL), now known as Aashrit Capital Ltd, had failed to disclose transactions and misrepresented financials of sale and purchase of properties. There were discrepancies in the financial statements for FY2015-16 and 2016-17.
In addition, the firm failed to represent a true and fair view of the state of affairs of the company and further, it executed loan agreements with parties without paying any stamp duty, Sebi said.
Sebi noted that Prateek Arora, Nimish Arora, Dilip Kumar Pipalwa, Richa Pipalwa and Shalabh Gaur who were the directors/CFO of the company at the relevant time, including independent directors are also liable for the violations committed by JCWL.
Through such acts, these entities have violated LODR (Listing Obligations and Disclosure Requirements) rules.
Individually, Sebi levied a fine of Rs 20 lakh on JCWL, Rs 10 lakh each on Prateek Arora, Nimish Arora and Dilip Kumar Pipalwa, Rs 4 lakh on Shalabh Gaur and Rs 2 lakh each on Roli Gupta, Heena Khurana, Satish Kumar Gupta, Richa Pipalwa, Suresh Kumar Moonka and Raj Kumar Agarwal.
Also, Sebi has prohibited eleven entities from accessing and dealing in the securities market for six months to one year.
The order came after Sebi carried out an investigation in the matter after receiving a forensic audit report (FAR) in November 2018.
The independent forensic auditor was appointed by MSEI after Sebi, through an interim order in October 2017, directed the stock exchange to appoint the same for verifying misrepresentation including of financials and or business of JCWL and misuse of the funds/books of accounts of JCWL, if any.
JCWL was in the list of 331 suspected shell companies released by the corporate affairs ministry in June 2017.
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