- SEBI has barred six entities from selling their shares in Dhenu Buildcon Infra (DBIL) amid allegations of manipulation of financial statements through complex transactions.
- In an interim order, SEBI alleged that the fraudulent activities included artificial fund rotation to boost the company’s value and secure preference shares illicitly.
- SEBI's findings indicate that Dhenu Buildcon purportedly obtained ₹1,000 crore in unsecured loans from seven entities and converted ₹840 crore of this debt into equity through preferential allotment.
- SEBI found that around ₹25 crore was repeatedly circulated to create the appearance of ₹1,000 crore in unsecured loans.
- The regulator identified Surendra Kumar Jain and Virendra Jain as key conspirators in the fraudulent activities.
- SEBI's interim order revealed that Dhenu Buildcon created a ₹1,000 crore unsecured loan in its books through 46 transactions over eight days.
- Despite reported inflows, the company's bank balance did not exceed ₹26 crore during the period, while approximately ₹996 crore was transferred to five entities within the same network.
- The transactions involved a coordinated arrangement of round tripping of funds and creation of purported unsecured loan liabilities.
- SEBI has issued interim preventive directions in the matter, barring Dhenu Buildcon from undertaking corporate actions until further orders.
SEBI's interim order has revealed that Dhenu Buildcon Infra allegedly engaged in fraudulent activities, including the creation of a ₹1,000 crore unsecured loan through 46 transactions over eight days. The regulator found that approximately ₹25 crore was repeatedly circulated to create the illusion of fresh funding.2346
The investigation indicated that ₹840 crore of this debt was converted into equity shares through preferential allotment, resulting in six entities holding 99.70% of the company's diluted equity share capital. SEBI identified key conspirators, Surendra Kumar Jain and Virendra Jain, who orchestrated the alleged round-tripping of funds.5
Despite the reported inflows, Dhenu Buildcon's bank balance did not exceed ₹26 crore during the period, while ₹996 crore was transferred to five entities within the same network. The regulator's findings suggest a coordinated effort to manipulate financial statements, violating the PFUTP Regulations.7
As a result, SEBI has barred Dhenu Buildcon from undertaking corporate actions and restricted the six allottees from disposing of or dealing with their shares until further notice. The interim order emphasizes the need for stringent measures against fraudulent and unfair trade practices in the securities market.
“SEBI's interim order reveals that Dhenu Buildcon allegedly created a false appearance of ₹1,000 crore in unsecured loans through 46 transactions over eight days. The regulator has barred the company and its key conspirators from capital markets until further notice, highlighting the severity of the fraudulent activities.”
CNBC TV18
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