The market regulator had initiated an investigation after it noticed an outburst of short text messages (SMS) during February-March 2013, luring gullible investors to buy the scrip of SMS Techsoft (India) Ltd.
The preliminary probe by Sebi found that the promoters and directors of SMS Techsoft were acting in concert with one Rajesh Ranka by issuing new equity shares of the company through preferential allotment to certain connected entities without receipt of full consideration.
Sebi, through an interim order in November 2013, had restrained these entities from "accessing the securities market and further prohibited (them) from buying, selling or dealing in securities or any instrument exchangeable or convertible into securities, directly or indirectly, in any manner whatsoever, till further directions."
In an order passed today, Sebi said these entities have "failed to give any plausible reasoning/explanation for their acts as dealt with in the interim order and have not been able to make out a prima facie case for revocation or modification of the interim order."
The ban will remain in force till further directions.