sebi:WTM/MPB/EFD-1-DRA-III/56/2019
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Facts / Headnote
Directions issued: CBL debarred from securities market for 5 years (with carve-out for preferential allotment to QIBs/AIFs for Genome Valley project); Dr. A.N. Singh and Ms. Padma Singh debarred from securities market for 5 years (with carve-out to subscribe to equity/debt of CBL for the Genome Valley project via preferential allotment from QIBs/AIFs); findings to become effective after 30 days unless objections filed.
Provisions invoked
- s. 19
- s. 12A
- s. 35
Regulations
- Reg. 3
- Reg. 4
- Reg. 4(1)
- Reg. 2(1)
- Reg. 28
- Reg. 2
- Reg. 2(c)
- Reg. 3(c)
- Reg. 4(1)(a)
- Reg. 5
Parties
- Celestial Biolabs Limited (CBL)
- Dr. A.N. Singh (Noticee No. 2)
- Mrs. Padma Singh (Noticee No. 3)
- M/s Lakshmi Purana & Associates
Holding
Dr. A.N. Singh and Ms. Padma Singh violated Section 12A(b) of the SEBI Act and Regulations 3(c) and 4(1) and 4(2)(a),(e),(f),(k),(r) of the PFUTP Regulations by their grossly negligent omissions in relation to misstated accounts of CBL, and CBL violated Regulations 4(1)(a),(b),(c),(d),(e),(g),(j) of the LODR Regulations by disclosing fake sales figures in its Annual Reports for FY 2010-11 and 2011-12.
Full text
Order in the matter of Celestial Biolabs Limited Page 2 of 41 Dr. A.N. Singh (hereinafter referred to as ‘Noticee No. 2’), Mrs. Padma Singh (hereinafter referred to as ‘Noticee No. 3’) and M/s Lakshmi Purna & Associates by playing their respective roles in this elaborate scheme, adopted a fraudulent device and artifice to defraud the genuine shareholders of the company by first falsely portraying sales transactions with pharma companies in Bio-IT services and then by treating the purported bad debts under the heading Product Development Expenditure. It was held that the aforesaid actions of the Noticees have led to the violation Section 12A (b) of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as ‘SEBI Act’) and Regulation 3(c) and Regulations 4(1) and 4(2),(a),(e),(f),(k), and (r) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’). Further, it was held that CBL, Dr. A.N. Singh and Ms. Padma Singh have also violated provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ‘LODR Regulations’) by disclosing fake sales figures in the Annual Reports of the company for the financial years 2010-11 and 2011-12.
Order in the matter of Celestial Biolabs Limited Page 3 of 41 Regulations qua the company in this order will come into effect. If objections are filed, then the directions passed herein against the company shall be made applicable subject to the determination on the objections. Till the determination of the objections, the
Order in the matter of Celestial Biolabs Limited Page 4 of 41 documents as requested by her, was also provided to her. 4. Subsequent to inspection, Noticees vide their letter dated December 11, 2018 requested extension of time till December 31, 2018 to submit their reply as it was taking time to process the data and to retrieve relevant data/information. Noticees request was acceded to and Noticees were granted time till December 31, 2018 to submit their reply. However, Noticees again vide their letter dated December 27, 2018 requested for further extension of time by one month on account of hospitalization of Noticee No. 1. Noticees were informed vide an email dated January 8, 2019 that their request for extension of time by one more month was considered by the Competent Authority and they were advised to submit their reply by January 15, 2019. REPLY
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Source: SecMarx — sebi:WTM/MPB/EFD-1-DRA-III/56/2019. 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.