A fine of Rs 6 lakh has been imposed on Anant Sureshchandra Maloo and Manan Vidhyapati Patel, payable jointly or severally.
Collectively, Wood Star (India) Pvt Ltd, Rohit Babulal Patel and Diptiben Rohitbhai Patel are facing a fine of Rs 5 lakh. Ajay Sureshchandra Maloo and Nina Ajay Maloo have been fined Rs 5 lakh.
Also, a fine of Rs 1 lakh has been imposed on Corporate Strategic Allianz Ltd, according to Sebi.
The Securities and Exchange Board of India (Sebi) had conducted an investigation for the period of June 22 to July 8, 2011, into the scrip of THL related to its IPO.
The company came out with its IPO in 2011.
The regulator observed that THL had failed to disclose its pre-existing liabilities amounting to about Rs 7 crore related to working capital expenses in its prospectus. On the contrary, it made an affirmative disclosure that there is no pre-existing liability related to working capital expenses, it added.
Further, it was revealed that the company had failed to disclose about Rs 7 crore loan taken from Alin on different dates in the month of May 2011 in the prospectus which was in the nature of bridge loan.
Sebi noted that on the contrary, THL made an affirmative disclosure that it has not raised any bridge loan against the proceeds of the IPO.
Moreover, the company inflated its purchases and sales figures for the years 2010-11 and 2011-12 which included the financial information contained in its prospectus, Sebi said in an order.
THL made a mis-statement in the quarterly statement to the exchange regarding utilisation of IPO proceeds for the quarter ended December 2013.
The company was later liquidated.
Anant Sureshchandra Maloo and Manan Vidhyapati Patel were the directors of the company during the IPO period. Wood Star, Rohit Babulal Patel, Diptiben Rohitbhai Patel, Ajay Sureshchandra Maloo and Nina Ajay Maloo have induced the investors to subscribe to the issue of THL, the order said.
The regulator noted that Corporate Strategic Allianz, the merchant banker of the issue, failed to exercise due diligence.
