Sebi bans Tree House Education, 5 others from market

Markets regulator Sebi today banned Tree House Education and Accessories, and five others from securities market in a matter related to misstatements of the financials of the firm.
The others are Rajesh Bhatia, Geeta Bhatia, Giridharilal S Bhatia, Vishal Shah and Hiten Trivedi.
While Rajesh Bhatia, Geeta Bhatia and Giridharilal S Bhatia are promoters of Tree House, Vishal Shah was the executive director of the firm from the period 2008 till 2016. Hiten Trivedi is the chief project officer.
According to an interim order, the six entities have been banned "till further directions".
Sebi also directed NSE to appoint an independent auditor or audit firm to conduct a detailed forensic audit of the books of accounts of Tree House from the financial year 201112 onwards till date.

The auditor has to verify manipulation of books of accounts and misrepresentation, including of financials and business operations of Tree House.

Besides, it also has to verify any wrongful diversion or siphoning of company funds by Tree House through significant 'related party transaction' with educational trusts controlled by Giridharilal S Bhatia and inflated expenditures on furniture and fixtures, among others.
The auditor has to submit a report to the Securities and Exchange Board of India (Sebi) through NSE within six months.
Sebi said that being the directors and promoters of Tree House, the individuals "were fully aware of the manipulation and misstatements concerning financials/business operations, etc of Tree House inter alia through 'related party transaction', inflated expenditure on furniture and fixtures, etc".

Taking cognisance of several media reports alleging irregularities in the functioning and operations of Tree House in December 2016, Sebi initiated an investigation for the period from April 1, 2011 to June 30, 2017.