Capital markets regulator SEBI has issued demand notices to 11 entities for paying ₹6 crore in a case involving Religare Finvest (RFL) fund diversion.
In case of failure to make the payment within the stipulated 15 days, the regulator has warned to attach assets and accounts of the entities.
The 11 entities on which notices were served include Torus Buildcon, Artifice Properties, Rosestar Marketing, Oscar Investments, Ad Advertising, Zolton Properties, Saubhagya Buildcon, Star Artworks, Vitoba Realtors, Devera Developers and Harpal Singh.
The demand notices were issued after these entities failed to pay the penalty imposed by SEBI in October 2022.
Complex web of transactions
The case involved a complex web of transactions whereby the funds of listed parent company Religare Enterprises (REL) were diverted through its subsidiary RFL for the ultimate benefit of the erstwhile promoters — RHC Holding, Malvinder Mohan Singh and Shivinder Mohan Singh. Funds were also misutilised for repayment of earlier loans taken from RFL.
As per the order, the whole scheme of fraud led to the diversion of funds of ₹2,474 crore out of a material subsidiary of REL and also misutilisation of funds of ₹488 crore of RFL.
Last October, SEBI imposed penalty of ₹21 crore on 52 entities, including these 11 entities, for diversion and misutilisation of funds of RFL. In this case, the regulator levied a fine ranging ₹20 lakh to ₹85 lakh on these entities.