Markets

Shell cos clampdown: Sebi lifts curbs on Prakash Industries

Markets regulator Sebi today lifted the curbs imposed on Prakash Industries, which was in the list of 331 suspected shell companies, after finding no "prima facie evidence" of misrepresentation of financials.

"In absence of prima facie evidence/ suspicion of misrepresentation of financials/ business by the company (Prakash Industries), misuse of the books of accounts / funds of the company or violation of LODR (Listing Obligation and Disclosure Requirements) Regulations, there is no reasonable ground to further verify the financials of the company warranting an audit," Sebi said in an order.

The regulator also said that it is of the considered view that the actions envisaged in Sebi's letter dated August 7 against Prakash Industries are liable to be revoked.

Prakash Industries is among the firms against whom Sebi initiated action on August 7 by ordering trading restrictions, following receipt of a list of 331 'suspected shell companies' from the government.

The ordered trade restrictions – allowing trade only once a month and that too for only buy transactions with a 200 per cent security deposit – were revoked in some cases a few days later following appeals filed by them with the Securities Appellate Tribunal, but Sebi was asked to continue with its probe and pass its orders expeditiously.

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