Guwahati: Sebi, the capital markets regulator, levied fines of Rs 23 lakh on three people on Wednesday in a case involving misrepresentation in the financial information of Indian Infotech and Software Ltd.

The regulator has penalised Kamal Nayan Sharma, Harish Joshi, and Mukund Bhardwaj with Rs. 8 lakh each for breaking rules against fraudulent trading, listing requirements, and other disclosure violations.

In an interim decision, Sebi asked the BSE to hire an independent forensic auditor to check the misrepresentations, including those in IISL's (Indian Infotech and Software Ltd) financials/business and abuse of funds/books of account.

However, it was discovered that IISL did not comply with the BSE-appointed forensic auditor.

The Securities and Exchange Board of India (Sebi) stated in a 34-page order that these individuals are responsible for IISL's failure to present true and fair financial statements as well as executing transactions that were non-genuine in nature, resulting in misrepresentation of the financial statements and misuse of the company's accounts, which would amount to fraud.

The notices did not reveal the misrepresentations in IISL's financial accounts, it noted. Sebi commenced adjudication procedures in the subject after reviewing IISL's annual reports for the fiscal years 2014-15 and 2015-16.
IISL was on the list of 331 suspected shell companies released by the corporate affairs ministry in June 2017.