Markets regulator Sebi today ordered forensic audit of Assam Company India that figures in the list of 331 suspected shell companies after prima facie observations about misuse of funds by the firm.
While calling for the forensic audit, the Securities and Exchange Board of India (Sebi) has lifted the trading restrictions imposed on the firm.
"In view of the prima facie observations regarding misuse of books of accounts or funds by Assam Company India Ltd (ACIL) and the suspicion regarding misrepresentation of its financials, the persons who are in control of the company and the directors of the company are prima facie liable for action by Sebi...," the regulator said in an interim order.
The regulator has directed the stock exchange to appoint an independent forensic auditor to verify any misrepresentation of financials and business of ACIL as well as any misuse of the funds or books of accounts.
"The trading in securities of ACIL shall be reverted to the status as it stood prior to issuance of letter dated August 7, 2017, by Sebi," the regulator said.
ACIL is among the firms against which Sebi initiated action on August 7 by ordering trading restrictions, following receipt of a list of 331 'suspected shell companies' from the government.
The trading restrictions, allowing trade only once a month and that too for only buy transactions with a 200 percent security deposit were revoked in some cases a few days later following appeals filed by the companies with the Securities Appellate Tribunal, but Sebi was asked to continue with its probe and pass its orders expeditiously.
In a separate order, the regulator lifted trading curbs on SQS India BFSI after finding that the firm did not indulge in any violations.
In an order, the regulator said in the absence of prima facie evidence or suspicion of misrepresentation by SQS India BFSI, misuse of the books of accounts or funds of the company, there is no reasonable ground to further verify the financials of the firm warranting an audit."... the actions envisaged in Sebi's letter dated August 7, 2017, against SQS are liable to be revoked," the regulator noted.