Mumbai: Market regulator SEBI on Wednesday barred Rajesh Exports CMD Rajesh Mehta from dealing in the company’s shares till further orders. In its interim order, SEBI also directed Rajesh Exports to cooperate with the regulator’s investigating officer and forensic auditors to probe the company’s books of accounts.SEBI’s preliminary investigation revealed that the company had manipulated its books of accounts, especially its revenues from foreign subsidiaries, to inflate its revenues over several years starting from FY2011. However, the company did not cooperate fully when asked by SEBI and its forensic auditors.The order stated that 97%–99% of the company’s revenues were “inflated, excessive and unheard of”. The order further said that the company has misrepresented approximately Rs 15.2 lakh crore, which is 99.8% of its revenue, attributed to subsidiaries during FY21 to FY25. “It appears that the above conduct has prima facie enabled (Rajesh Exports) to present to investors and the securities market an inflated and misleading picture of its operational scale, consolidated financial position and financial health.“The company had also announced in FY23 that it had invested Rs 1,035 crore in gold mines in Africa. However, neither any such investment was reflected in the standalone financial statements of Rajesh Exports for FY23, nor in the standalone financial statements of any of the company’s subsidiaries.SEBI’s investigation and forensic audit also found that the company had “resorted to methods of misleading and deceiving investors trading in the shares of the company by presenting a misleading picture of its trade receivables, trade payables and overall financial position.”Apart from imposing restrictions on Mehta and directions to cooperate with the regulator’s officials and auditors, Sebi also sent a copy of its order to the National Financial Reporting Authority for “appropriate action, if any, against the statutory auditors of Rajesh Exports (BSD & Co)”.
