India’s capital market watchdog, the Securities and Exchange Board of India (SEBI), has imposed a total penalty of ₹58.5 crore on four senior officials of Seya Industries Ltd for serious financial misconduct, including the misappropriation of funds and manipulation of financial records.
The individuals penalised include the company’s promoter and Chairperson Ashok Rajani, his son and Chief Financial Officer (CFO) Amrit Rajani, and Executive Directors Asit Kumar Bhowmik and Sivaprasada Rao Buddi.
According to SEBI’s 122-page order, a forensic audit revealed that the company had diverted ₹81.26 crore between FY2019 and FY2021. The funds were funnelled to entities associated with the promoter family Whiz Enterprises, Aneeka Universal, and Shri Balaji Entertainments disguised as regular business transactions or via undeclared transfers. These were not recorded as related party transactions, violating disclosure requirements.
The audit further exposed fake sales and purchases in Seya’s financial statements for FY2019 and FY2020, breaching SEBI’s Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) norms and other disclosure obligations. The company’s interest accounting between FY2020 and FY2022 also failed to comply with Indian Accounting Standards.
In response to these findings, SEBI issued the following penalties:
Additionally, all 4 individuals have been barred from participating in the securities markets for 5 years. They are also prohibited from serving as directors or key managerial personnel (KMPs) in any listed company or SEBI-registered intermediary during this period.
SEBI directed Amrit Rajani to return the ₹81.26 crore siphoned from the company, along with 12% annual interest, within 6 months.
The investigation was initiated after multiple complaints were lodged in 2020 and 2021, including one by SC India Fund Manager. The complainants alleged that Seya Industries raised capital via private placements based on inflated financials.
When the company failed to comply with the NSE’s request for cooperation, SEBI appointed Ernst & Young in September 2021 to conduct a forensic audit of the company’s financials for FY19 to FY21.
Despite the damning findings, no immediate regulatory action has been taken against Seya Industries as a corporate entity due to ongoing insolvency proceedings under the Insolvency and Bankruptcy Code (IBC). SEBI clarified that any action against the company itself will be taken separately.
SEBI highlighted that Ashok Rajani was deeply involved in day-to-day operations and directly signed off on misleading financial statements over multiple years. His son, Amrit, as CFO and a key managerial person, was held equally responsible.
Meanwhile, Bhowmik and Buddi were found to have neglected their duties related to compliance and accurate reporting, thus undermining investor confidence and regulatory trust.
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The SEBI action against Seya Industries’ top executives underscores the regulator’s firm stance on corporate accountability and transparent financial practices.
The ₹58.5 crore penalty, coupled with multi-year bans, sends a strong message to listed companies and their leadership that financial misconduct and failure to uphold governance standards will face serious consequences.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: May 5, 2025, 10:22 AM IST
Neha Dubey
Neha Dubey is a Content Analyst with 3 years of experience in financial journalism, having written for a leading newswire agency and multiple newspapers. At Angel One, she creates daily content on finance and the economy. Neha holds a degree in Economics and a Master’s in Journalism.
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