Sebi fines Jaiprakash Power Ventures, top officials for misrepresenting co's financial statements

Markets regulator Sebi on Friday imposed a penalty totalling Rs 54 lakh on Jaiprakash Power Ventures, its MD and CEO Suren Jain and other top officials for misrepresenting the company's financial statements.

Others who have been penalised by Sebi are company's chairperson Manoj Gaur, executive directors -- Sunil Kumar Sharma and Praveen Kumar Singh -- chief financial officer R K Porwal and former whole-time member M K V Rama Rao.
They have been directed to pay the fine within 45 days, the Securities and Exchange Board of India (Sebi) said in its 89-page order.

This came after the regulator conducted an investigation in the matter of Jaiprakash Power Ventures Ltd (JPVL), a part of the Jaypee Group of companies, to ascertain the possible violations of PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) and LODR (Listing Obligations and Disclosure Requirements) rules.

In its probe, Sebi found that the company overstated its books of accounts by not adopting the correct accounting practices and by not measuring investments in Sangam Power Generation Company Ltd (SPGCL), Jaypee Arunachal Power Ltd (JAPL) and Jaypee Meghalaya Power Ltd (JMPL) at fair value during FY 2012-13 to FY 2021-22, hence, profit and loss account and balance sheet of the company did not reflect the true and fair view.

"I hold that the company overstated its books of accounts by way of not providing interest on its current investments, Foreign Currency Convertible Bonds (FCCBs) and other unsecured loan in FY 2018-19, therefore, the financial statements of the company have not reflected true and fair view," Sebi's Adjudicating Officer Asha Shetty said.

By misrepresenting its books of accounts, JPVL has violated the provisions of PFUTP as well as LODR Regulations.

Accordingly, the regulator levied a fine of Rs 14 lakh on Jaiprakash Power Ventures, Rs 7 lakh each on Jain, Gaur, Sharma and Singh and Rs 6 lakh each on Porwal and Rao.