Veteran investor Shankar Sharma is among the 23 entities who have been prohibited from selling Brightcom Group’s shares, according to an interim order released by the market regulator.
The interim order, dated August 22, was passed as investigations into the company’s preferential allotment of shares are ongoing. The order was passed with urgency after findings “clearly” showed “manipulations carried out by BGL and other Noticees (24 of them), in respect of BGL’s preferential allotments, which inter alia involve fictitious receipts of share application money from allottees and siphoning of funds from BGL”.
The regulator has stopped the company’s Chairman and Managing Director Suresh Kumar Reddy and its CFO Narayan Raju from holding the position of a director or a Key Managerial Personnel in any listed company or its subsidiaries until further orders; and restrained Suresh Kumar Reddy from dealing in securities until further orders. In the order, it has also ordered the company to ensure that statutory auditors of the company P. Murali & Co. and PCN & Associates, including their past and present partners, are not engaged with BGL or its subsidiaries in any capacity or manner whatsoever.
According to the order, noticee number 25, Sharma was issued 1,50,00,000 warrants at Rs 37.77 per warrant, which would have a total of Rs 56.66 crore to be paid to the company. But only Rs 39.98 crore was received by the company, which led to a shortfall of Rs 16.67 crore.
Even the Rs 39.98 crore payment could not be verified, according to the order.
“BGL had received Rs.25.7936 Crore from Mr. Shankar Sharma. Subsequently, Mr. Shankar Sharma vide emails dated July 25 & 26, 2023 informed SEBI that he paid Rs.14.19 Crore towards warrant application money to BGL’s HDFC Bank Account. In this regard, he submitted copy of his bank account statement. However, in the said statements, all the particulars of the transaction, except the amount, were concealed by redaction. Due to the same, the above payment could not be verified and the same is still under examination. Therefore, it appears that BGL has only received Rs.39.98 Crore (including Rs.14.19 Crore which could not be verified) as against total consideration due of Rs.56.6555 Crores and has not received the entire share application money from Mr. Shankar Sharma and that BGL’s claims in this regard are false,” it stated.
The order noted that the regulator has repeatedly tried to obtain information and supporting documents from Sharma regarding payments made by him to BGL in respect of the warrants or shares allotted. However, the order added, he is yet to provide complete information and documents to SEBI.
In all, the 22 entities mentioned in the order were allotted 25,76,50,000 equity shares for Rs 245.24 crore, but the Company had received only Rs 52.51 crore and the remaining amount of Rs.192.73 crore was “either not received by the Company or was routed back to the said allottees through multiple layering of transactions involving subsidiaries and conduits”.
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