SEBI v. Seya Industries Limited and others (fictitious sales and diverted funds, 2025)

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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A SEBI whole-time member found that the managing director, chief financial officer and two directors of Seya Industries used sham proprietorship firms to fabricate business, siphoned about Rs 81.26 crore to related companies and misreported results. The order imposed five-year bans and penalties totalling Rs 58.5 crore on four individuals; the company was left to a separate order.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

—

Alleged gain

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Penalty as published

585m 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

On 2 May 2025 a SEBI whole-time member issued a final order in the matter of Seya Industries Limited, a listed company then under insolvency proceedings. The noticees were the company, its promoter and managing director Ashok Ghanshyamdas Rajani, his son and chief financial officer Amrit Ashok Rajani, and two directors, Asit Kumar Bhowmik and Sivaprasada Rao Buddi. The order deals at length with objections based on the insolvency moratorium and inspection, and the proceedings against the company itself were deferred to a separate order.

SEBI's case was that Seya recorded high-value sales and purchases with a set of proprietorship firms set up by an intermediary using financially weak individuals, creating false turnover, and that circular transactions made the activity look genuine. It alleged that money and assets of Rs 81.26 crore were moved from Seya to three privately held companies run by the promoter's family. It also alleged failures to disclose related party dealings, material events and bank interest, wrong board attendance filings, appointment of ineligible auditors and false information given to SEBI.

The member found these allegations established on a preponderance of probability. He held that the published results overstated profit and understated losses, that the diversion went to companies controlled by the chief financial officer and his relatives, and that the promoter and the chief financial officer were the main perpetrators. The two other directors were treated as less culpable, with the longer-serving member of the audit committee held more responsible. The order notes the company's bank borrowings of about Rs 245 crore and a rise in retail shareholders in the period.

The four individuals were restrained from the securities market and from holding director or key managerial posts in listed companies or SEBI-registered intermediaries for five years. Amrit Rajani was directed to bring the Rs 81.26 crore back to Seya with 12 per cent annual interest within six months. Penalties under sections 15A, 15HA and 15HB were Rs 28 crore each on the two Rajanis, Rs 2 crore on Mr Bhowmik and Rs 50 lakh on Mr Buddi, Rs 58.5 crore in total.

The record does not show whether any noticee appealed, whether the funds were returned, or what the later order on the company decided. The order is a regulatory sanction, not a criminal conviction.

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. 2025-05-02 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
• Order (PDF)

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.