SEBI v. Man Industries (India) Limited and others (misstated consolidated accounts and disguised loans, 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 chief general manager found that Man Industries left a loss-making wholly owned subsidiary out of its consolidated accounts, relabelled loans to it as capital advances and used year-end circular fund flows to dress up its balance sheet for six years. The company, its chairman, an executive director and its chief financial officer each received a two-year market ban and Rs 25 lakh in penalties.

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

10m 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 29 September 2025 a SEBI chief general manager issued a final order against Man Industries (India) Limited and three of its officers: the chairman Ramesh Mansukhani, executive director Nikhil Mansukhani, and Ashok Gupta, a former executive director who is now chief financial officer. A complaint alleged diversion of funds to subsidiaries and non-consolidation to hide losses, and a forensic audit covered financial years 2014-15 to 2020-21.

The show cause notice of 3 August 2022 alleged that the consolidated accounts for 2015-16 to 2020-21 were misrepresented by leaving out a wholly owned subsidiary, that loans to it of Rs 5,641.38 lakh were reclassified as capital advances without audit committee approval or related-party disclosure, that interest income was not recognised, that a loan to another related company was made without approval, and that related-party dealings were disclosed only in net terms.

The officer found that the statements for the six years were deliberately misstated, that the omissions and concealments were themselves the scheme by which investors were deprived of the true picture, and that Mr Ramesh Mansukhani, with the participation of the other two individuals, certified them year after year despite auditor qualifications. He highlighted year-end circular flows of repayments that were re-advanced in April, an uncashed cheque of Rs 1,150.49 lakh booked against interest receivable, and an undisclosed pledge of the subsidiary shares. He found violations of the fraud provisions of the SEBI Act and the PFUTP Regulations as well as listing rules, noting that in some instances the alleged violations were not established and that the effect of the non-consolidation was a mitigating factor.

All four noticees were restrained from accessing the securities market for two years, with existing holdings frozen during the period. Each was penalised Rs 15 lakh under section 15HA and Rs 10 lakh under section 15HB, a total of Rs 1 crore. No disgorgement was ordered, since no unlawful gain was shown.

The record does not show whether any noticee appealed, whether the penalties were paid, or what the misstatements cost investors. The order is a regulatory sanction, not a criminal conviction.

This library tags the matter as misleading issuer disclosure (financial statement fraud). 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. 2025-09-29 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.