Manpasand Beverages Ltd (MBL), a company based in Vadodara, Gujarat, has been barred by the Securities and Exchange Board of India (Sebi) from the securities markets for three years.
This decision came after it was found that MBL and its top officials manipulated and misreported the company's financial statements.
MBL, a beverage company, was involved in a Goods and Services Tax (GST) fraud of over Rs 40 crore.
They created fake units and inflated their turnover by using these fake units to make it seem like they were doing more business than they actually were.
They also used fake invoices to claim input tax credit and avoid paying GST, causing a loss to the government.
The company set up fake units to inflate its sales numbers and used these fake units to evade taxes.
They were caught when the Central GST Commissionerate investigated and found irregularities in their operations.
The tax evasion amounted to Rs 40 crore, involving a turnover of Rs 300 crore. This impacted the government's tax revenue.
Deloitte resigned as MBL's auditor in 2018, signaling problems within the company.
Senior executives were later arrested for the GST fraud in 2019.
Investigations revealed the extent of the fraud, including the creation of fictitious units to evade taxes.
Sebi has barred MBL and its top officials from the securities markets for three years and imposed fines totaling Rs 74 lakh.
The company's promoters and key officials have also been prohibited from holding positions in any listed public company or intermediary registered with the regulator for five years.
Additionally, former and current independent directors of the company have been fined for their involvement.