sebi:WTM/AB/SEBI/MIRSD/NRO/06/2019-20
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Facts / Headnote
Interim directions dated February 27, 2019 confirmed against Noticee Nos. 1, 5, 6, 7, 8, 9, 10 and 11 pending forensic audit and SEBI investigation; directions against Noticee Nos. 2, 3 and 4 discontinued at this stage.
Provisions invoked
- s. 11(4)
- s. 19
Regulations
- Reg. 9
- Reg. 35
Holding
No case for revocation was made out by Noticee Nos. 1, 5, 6, 7, 8, 9, 10 and 11, so directions at para 8(a), 8(b), 8(c), 8(e), 8(f), 8(g) and 8(i) of the interim order dated February 27, 2019 stand confirmed pending forensic audit and investigation, while directions against Noticee Nos. 2, 3 and 4 are discontinued.
Full text
Page 2 of 22 personal hearing, the findings in the interim order and the directions contained therein would be confirmed against such Noticees.
Page 3 of 22 furnished a list of ‘creditors payable’ as on 31/01/2019. In the said list Noticee no. 1 has excluded the entries of some clients, such as Awanish Kumar Mishra (Noticee No. 5), Primarc Projects Private Limited, Money Mishra Overseas Pvt. Ltd. (Noticee No. 8), Glow Homes Technologies Pvt. Ltd., Money Mishra Financial Services (Noticee No. 7), Dal Chandra Rastogi, Tejswi Impex Pvt. Ltd., as ‘creditor’s payable’. However, in the trial balance provided to NSE during inspection the said clients were included as ‘creditors payable’. I note that Noticee no. 5, 7 and 8 are related and associated entities of Noticee no. 1 and Noticee no. 1, in order to avoid the consequences of this proceeding appears to have excluded Noticee no. 5, 7 and 8 from ‘creditors payable’, whereas the said Noticees were shown as ‘creditors payable’ in the trial balance which was submitted to the NSE inspection team. Hence, prima facie the evidence produced by Noticee no. 1 cannot be relied upon and a clear magnitude of the ‘creditor’s payable’ and the resultant shortfall of funds, if any, may be known after the completion of the ongoing forensic audit of AFSPL.
Page 4 of 22 statement along with its reply. However, I note that Noticee no. 1 has not provided the copies of ROS and the holding statement of its DP account to verify the entries in the reconciliation statement, and even if the copies of ROS and the holding statement of DP account were submitted, the same needs to be verified and determination of facts can be arrived after completion of ongoing forensic audit.
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Source: SecMarx — sebi:WTM/AB/SEBI/MIRSD/NRO/06/2019-20. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.