SEBI v. Gautam Thapar and others (CG Power fund diversion and misstated accounts, 2022)

Judgment entered

✓ Checked against the primary document on October 8, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, in a single reading of the order; an independent second reading of 60 SEBI records agreed on every field for 56, the four misses being penalty amounts; a later sample of 50 of the SEBI records added on 9 October agreed on every field for 46. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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In a final order of 4 October 2022 a SEBI whole-time member found that funds of CG Power were diverted to promoter-linked entities through disguised loans and that the company's accounts were misstated. He imposed market bans of up to five years and penalties totalling Rs 30.15 crore on eleven noticees.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

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Alleged gain

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Penalty as published

302m INR

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars. This regulator states penalties in INR. The figure is recorded as published and is not converted, so it does not appear in the USD totals or medians used elsewhere on this site.

What is alleged to have happened

CG Power and Industrial Solutions Ltd is a listed engineering company whose former chairman Gautam Thapar was associated with the Avantha group. In August 2019 the company told the exchanges that its liabilities and advances may have been understated by amounts running to hundreds and thousands of crores of rupees, and its share price fell. SEBI had earlier issued an interim order in September 2019, confirmed in March 2020; this order of 4 October 2022 is the final order after a show cause notice of May 2021.

The eleven noticees were Mr Thapar, three group companies (Avantha Holdings, Acton Global and Solaris Industrial Chemicals), the company's chief financial officers, finance directors and chief executive, an employee, and two financial institutions, Aditya Birla Finance and IndusInd Bank. SEBI alleged that CG Power's money was routed to the Thapar-linked entities through loans structured with the two institutions and other transactions, and that the company's published financial statements did not show the true position.

The whole-time member found the allegations proved in substance. The order holds that about Rs 1,093 crore of the company's funds went directly or indirectly to Mr Thapar and two of the group companies, that the executives took part in the impugned transactions or were responsible for the accuracy of the accounts, and that the two institutions helped structure the diversion. These conduct findings were made under the fraud-prevention rules and section 12A of the SEBI Act.

The sanctions were five-year market bans on Mr Thapar and the three group companies and bans of three years and six months on three former finance executives, with time already served under the interim order set off. Penalties came to Rs 10 crore on Mr Thapar, Rs 5 crore on each of the three group companies, Rs 1 crore each on the three finance executives, Rs 10 lakh on the chief executive, Rs 5 lakh on the employee and Rs 1 crore each on the two financial institutions, Rs 30.15 crore in total. CG Power was told to keep pursuing recovery of the sums due to it.

The record does not show whether any noticee appealed, how much was recovered, or the loss to investors, which the order says it could not quantify.

This library tags the matter as misleading issuer disclosure. The tagging is ours, not the regulator's.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the order.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Misleading issuer disclosure — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2022-10-04 SEBI order

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEBI order

The linked release is published by the issuing regulator under its own terms. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added October 8, 2026. submit a correction.