SEBI v. Vikash Metal & Power Ltd. and others (GDR issue penalties, 2022)

Judgment entered

✓ Checked against the primary document on October 9, 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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A SEBI adjudicating officer fined five people a combined Rs 70 lakh in September 2022 over Vikash Metal & Power's 2011 GDR issue, finding the issue was funded by the company itself and the pledge hidden from investors. The company, in liquidation, was named but not penalised.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

—

Total relief

—

Alleged gain

—

Penalty as published

7m 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 in Mumbai decided this matter on 30 September 2022. The noticees were the listed company Vikash Metal & Power Ltd., three of its directors (Akkash Patni, Vimal Kumar Patni, Vikash Patni), Arun Panchariya of the lead manager Pan Asia Advisors, and Mukesh Chauradiya of the subscriber Vintage FZE. A separate whole time member order of 27 September 2022 restrained the three directors from the market.

SEBI examined the issue of about 12 lakh GDRs worth USD 11.99 million (about Rs 53 crore) on 12 April 2011. It alleged that Vintage was the only subscriber, that it borrowed the money from Euram Bank, and that the company's GDR proceeds account was pledged against that loan so that the issue was in substance funded by the company. It also alleged that the pledge was concealed and that GDR news was given to the exchanges in a distorted way, so that investors believed the issue was genuinely taken up.

The company is being wound up under the Calcutta High Court's official liquidator, who reported that no submission would be made. The order finds that the remaining five noticees violated section 12A of the SEBI Act and Regulations 3(a) to (d) and 4(1) of the PFUTP Regulations. The officer says about USD 11.46 million of the proceeds was taken by the bank against Vintage's loan, so GDRs were in effect issued free of cost, to the loss of shareholders.

Penalties under section 15HA are Rs 20 lakh each on Akkash Patni and Mukesh Chauradiya and Rs 10 lakh each on Vimal Kumar Patni, Vikash Patni and Arun Panchariya, Rs 70,00,000 in total. No penalty is listed for the company.

The record does not show whether the penalties were paid or appealed, or whether any money was recovered from the liquidation.

This library tags the matter as misleading issuer disclosure (financed GDR issue presented as genuinely subscribed). 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. 2022-09-30 SEBI adjudication 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
• SEBI order (PDF)

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.