Shell cos clampdown: Sebi lifts curbs on Signet Industries

Regulator Sebi today lifted trading curbs on Signet Industries, which figured in the list of 'suspected shell companies', after finding no prima facie evidence of misuse of funds.

While the restrictions have been removed with respect to Signet Industries Ltd (SIL), the regulator has ordered a forensic audit for Scintilla Commercial & Credit Ltd (SCCL).

"I do not find any prima facie evidence nor suspicion of misrepresentation by the company, misuse of books of accounts/ funds of the company (SIL) or violation of LODR (Listing Obligation and Disclosure Requirements) Regulations," Sebi Whole Time Member Madhabi Puri Buch said in an order.

In view of no such evidence, Buch said there is no reasonable ground to further verify the financials of SIL warranting an audit.

"I am, therefore, of the considered view that the actions envisaged in Sebi's letter dated August 7, 2017 against SIL are liable to be revoked," the Whole Time Member added.

SIL and SCCL are among the firms against whom Sebi initiated action on August 7 by ordering trading restrictions, following receipt of a list of 331 'suspected shell companies' from the government.

"An independent auditor shall be appointed to conduct forensic audit of the company for verification, including the credentials/ financials of the company (SCCL)," a BSE notice said today.

The notice also said that the trading in securities of the company shall be reverted to the status as it stood prior to issuance of Sebi letter dated August 7, 2017.

Also, the promoters and directors in SCCL have been permitted only to buy the securities of the firm and directed not to sell their existing holding in it, according to the notice.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)