sebi:WTM/MPB/EFD-1-DRA-III/40/2018
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Facts / Headnote
SCN dated December 07, 2017 disposed of with finding of violation of PFUTP Regulations; Mr. K.E. Devarajan directed to ensure internal records reflect correct data and publish forthcoming quarterly filings reflecting changes; Mr. Vijayraj Surana, Mr. K.E. Devarajan and Mr. S. Guruswamy restrained from accessing/dealing in securities market and from associating with any listed public company/public company intending to raise money or SEBI-registered intermediary for 5 years from date of compliance with corrective direction.
Provisions invoked
- s. 19
- s. 12A
- s. 168(2)
- s. 168(1)
- s. 112
Regulations
- Reg. 3
- Reg. 200
- Reg. 3(a)
- Reg. 8
- Reg. 8(2)
Parties
- Vijayraj Surana
- K.E. Devarajan
- S. Guruswamy
Holding
The Noticees as directors/officers of Surana Corporation Limited are liable for manipulation of books of accounts and misrepresentation of financial results for 2013-2015 in violation of Regulations 3(a),(c),(d), 4(1), 4(2)(e),(k),(r) of PFUTP Regulations read with Section 12A(a),(b),(c) of SEBI Act, and are subject to corrective disclosure and 5-year market access/association restraint.
Full text
Order in the matter of Surana Corporation Limited Page 2 of 28 2. Securities and Exchange Board of India (hereinafter referred to as “SEBI”) received a reference dated January 21, 2015 from Chennai Zonal Unit - Directorate of Revenue Intelligence ('DRI'), Department of Revenue, Ministry of Finance against SCL wherein it was stated, based on a search conducted by DRI, that documents had been seized showing discrepancy in financial statements and documents pertaining to sale and purchase of goods and stock of goods.
Order in the matter of Surana Corporation Limited Page 3 of 28 sought from SCL by SEBI vide summons dated February 3, 2016, to which the Company replied vide letter dated February 26, 2016. Mr. Vijayraj Surana was summoned to appear before the Investigating Authority (IA) on May 20, 2016. Thereafter, on June 9, 2016, Mr. Vijayraj Surana appeared with Mr. K E Devarajan.
Order in the matter of Surana Corporation Limited Page 4 of 28 iii. Further as per the DRI reference, documents were created by SCL to show sales to three firms, viz. M/s. Maruthi Corporation ("MC"), M/s. Marudhar Trading ("MT") and M/s. C & S Tools Private Limited ("CST"). Pursuant to the investigation conducted by SEBI, from accounting data maintained by SCL the following were noted: Transactions with MC: (a) From the ledgers of MC as brought on record, for the financial year 2014-2015, it was noted as following: Maruti Corporation A/c during the FY 2014-15 Date Particulars Debit Credit Various dates To Gold Sales 1% / Sales Credit 916 - 1% / Silver Sales incl. opening sales balance of Rs. 24 Cr and netting off reversal made on 16/10/2014 for Rs. 26,87,40,814/-
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Source: SecMarx — sebi:WTM/MPB/EFD-1-DRA-III/40/2018. 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.