The Securities and Exchange Board of India (SEBI) has barred Man Industries (India) Ltd and three of its top executives, including the Chairman, from accessing the securities markets for two years. The order comes after the regulator found evidence of financial misreporting and alleged fund diversion spanning multiple years.
SEBI’s Key Findings
According to SEBI’s order, Man Industries:
- Did not consolidate its subsidiary, Merino Shelters, in its financial statements between FY2015 and FY2021, leading to incomplete and misleading disclosures.
- Misrepresented related-party transactions, raising concerns over transparency and accountability.
- Engaged in round-tripping of funds to conceal its true financial condition, thereby misleading investors.
The regulator concluded that these practices undermined the integrity of financial reporting and violated securities laws meant to protect shareholders.
Penalties Imposed
In addition to the two-year ban, SEBI announced monetary penalties of ₹25 lakh each on:
- Man Industries (India) Ltd
- Ramesh Mansukhani, Chairman
- Nikhil Mansukhani, Managing Director
- Ashok Gupta, former Chief Financial Officer
The order highlights SEBI’s intent to enforce strict accountability on both corporate entities and individuals at the helm of governance.
Background of the Case
The action stems from a forensic audit commissioned in November 2021, which scrutinized the company’s accounts over a six-year period. The audit identified several financial irregularities, prompting SEBI to initiate enforcement proceedings.
Man Industries, a Mumbai-based manufacturer of pipes and steel products, has yet to publicly comment on the order.
Summary:
SEBI has barred Man Industries and three of its senior executives — Chairman Ramesh Mansukhani, Managing Director Nikhil Mansukhani, and former CFO Ashok Gupta — from accessing the securities markets for two years, while also imposing a penalty of ₹25 lakh each. The regulator’s action follows a forensic audit that uncovered financial irregularities between FY2015 and FY2021, including failure to consolidate subsidiary Merino Shelters, misrepresentation of related-party transactions, and round-tripping of funds to mask the company’s true financial position. The case underscores SEBI’s strict approach toward enforcing corporate governance standards and curbing financial opacity in listed firms.
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