Regulator Sebi Friday barred Celestial Biolabs as well as its chairman A N Singh and wife Padma Singh from the capital markets for 10 years for fabricating the company's sales figures and making false disclosures.
Besides, the capital markets watchdog has restrained Celestial Biolabs' statutory auditor Lakshmi Purna & Associates for not being cautious and careful while certifying the annual accounts of the firm.
The regulator carried out a probe to ascertain whether books of accounts of the company were manipulated by way of fictitious transactions to project a rosy picture of the company to the shareholders in 2010-11 and 2011-12 and to see whether there was any violation of the provisions of PFTUP (Prohibition of Fraudulent and Unfair Trade Practices) norms.
Sebi found that the company employed deceptive devices by projecting inflated sales in Bio-IT and had adopted dubious and inconsistent practices in drawing up accounts for manipulating the financial results of the firm to present a rosy picture to its shareholders and to the public at large.
According to the regulator, the firm showed fake sales amounting to Rs 677 lakh in 2010-11 and Rs 395 lakh in 2011-12 and the same was disclosed in its annual reports.
It further said that the couple and Purna & Associates by playing their respective roles in this elaborate scheme, "adopted a fraudulent device and artifice to defraud the genuine shareholders of the company by first falsely portraying sales transactions with pharma companies in Bio-IT services and then by treating the purported bad debts