Regulator SEBI on September 13 barred ex-officials of Dr Datsons Labs from securities markets for up to three years for not utilising IPO proceeds as stated in the offer documents.
Sebi has prohibited Kashi Vishwanathan, who was chairman of the company, and Kannan Vishwanath, who was managing director, for three years. Prabhat Goyal and Shashikant B Shinde, who were whole time executive directors, have been restricted for one year, as per the regulator's order.
The Securities and Exchange Board of India (Sebi) conducted an investigation in the matter of initial public offer (IPO) by Datsons (formerly known as Aanjaneya Lifecare) in 2011 to ascertain any possible violation of regulations.
The company came out with an initial share-sale in May 2011 to raise Rs 117 crore.
Pursuant to the investigation, Sebi found, "the company and its directors have not utilised the IPO proceeds for the objects stated in the RHP (offer document) and have utilised the IPO proceeds for other undisclosed purposes".
"Thus, the noticees (the four former directors), by resorting to unfair means behind the back of innocent investors have concealed material information from them and have deliberately published misleading information in the offer document," it added.
By indulging in such activities, they have violated the provisions of the SEBI Act, PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms and ICDR (Issue of Capital & Disclosure Requirements) Regulations.
Accordingly, the regulator has restrained these individuals from capital markets for a period varying from one year to three years. Further, during the period of restraint, the existing holding of securities of these individuals units of mutual funds will remain frozen.
Also, they have been barred from associating themselves with any public listed company and further restrained from holding any key managerial position in any other listed company or any registered intermediaries.