SEBI withholds Nusli Wadia, sons from stock market for 2 years


The Securities and Exchange Board of India barred industrialist Nusli Wadia, his sons Ness Wadia and Jehangir Wadia and their promoted company – Bombay Dyeing and Manufacturing Company Limited (BDMCL) – from accessing the securities market and from buying on Friday, for two years. sell or otherwise deal in securities in any way.

SEBI’s full-time member Anant Barua has also imposed fines of 5 crore on Jehangir Wadia, 4 crore each on BDMCL and Nusli Wadia, and 2 crore on Ness Wadia for deliberate misrepresentation of BDMCL financial statements between 2011-12 and 2017-18.

“I note that due to the misrepresentation of BDMCL’s financial statements, BDMCL’s revenues and profits were inflated by 2,492.94 crores and 1,302.20 crores respectively, from FY 2011-12 to FY 2017-18,” Barua said in the order.

The SEBI had launched an investigation after receiving complaints that BDMCL used a Scal Services Limited to artificially inflate its sales and profits and misrepresent the financial statements accordingly.

Based on the complaints, the market regulator had notified BDMCL and its promoters – chairman Nusli Wadia, his son and director Ness, another son and non-executive director Jehangir, as well as Scal Services and its directors.

After hearing them, the board found substance in the complaints and approved the injunction Friday, also imposing restrictions on Scal Services and its then directors; it also imposed a fine of 1 crore on the company and of various amounts on its directors.

Scal Services, which according to SEBI was indirectly controlled by Wadias, was finally merged into BDMCL in July 2018.



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