SEBI v. Rainbow Papers Ltd. and others (GDR issue disclosures, 2022)

Judgment entered

✓ Checked against the primary document on October 8, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, in a single reading of the order; an independent second reading of 60 SEBI records agreed on every field for 56, the four misses being penalty amounts; a later sample of 50 of the SEBI records added on 9 October agreed on every field for 46. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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On 27 May 2022 a SEBI adjudicating officer penalised four people, Ajay and Sangeeta Goenka, Arun Panchariya and Mukesh Chauradiya, a combined Rs 60 lakh over a US$27.02 million GDR issue by Rainbow Papers funded through a loan secured on the proceeds. The proceedings against one director abated on his death.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

—

Alleged gain

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Penalty as published

6m INR

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars. This regulator states penalties in INR. The figure is recorded as published and is not converted, so it does not appear in the USD totals or medians used elsewhere on this site.

What is alleged to have happened

A SEBI adjudicating officer, G Ramar, decided the matter on 27 May 2022. The six noticees were Rainbow Papers Ltd (RPL), listed on NSE and BSE, its directors Ajay Goenka, Radheshyam Goenka and Sangeeta Goenka, and Arun Panchariya and Mukesh Chauradiya, who were tied to the GDR subscriber. SEBI had investigated RPL's global depository receipt issue between January and February 2010.

The order records that RPL issued about 1.02 million GDRs worth US$27.02 million on 27 January 2010, subscribed by a single entity, Vintage FZE. Vintage paid for them with a loan from EURAM Bank, and Ajay Goenka signed a pledge agreement on the same day as the loan agreement that pledged the GDR proceeds as security for the loan. Board resolutions had authorised the account and its use as security. SEBI alleged that the scheme was therefore a fraud, because the company itself backed the subscription, that this was not disclosed, and that investors were left unaware of how the issue was funded.

The officer found the scheme fraudulent under section 12A and Regulations 3 and 4(1) of the 2003 fraudulent and unfair trade practices regulations, and noted that Vintage, Mr Panchariya and Mr Chauradiya had been subject to action in similar GDR schemes before. Radheshyam Goenka had died in 2010 and the proceedings against him stood abated.

The penalties under section 15HA were Rs 20 lakh each on Ajay Goenka and Arun Panchariya and Rs 10 lakh each on Sangeeta Goenka and Mukesh Chauradiya, a total of Rs 60 lakh, payable within 45 days. The operative table lists no penalty on RPL itself.

The record does not show how the money from the GDRs was finally used, whether the penalties were appealed or paid, or whether further action followed.

This library tags the matter as misleading issuer disclosure. The tagging is ours, not the regulator's.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the order.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Misleading issuer disclosure — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2022-05-27 SEBI order

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEBI order

The linked release is published by the issuing regulator under its own terms. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added October 8, 2026. submit a correction.