SEBI Clears Suzlon Of Misrepresentation Charges In Financial Statements Probe

The Securities and Exchange Board of India has closed proceedings against Suzlon Energy Ltd. after its investigation found no evidence of misrepresentation in the company’s financials. The probe examined Suzlon’s accounts from 2014-15 through to the first three quarters of 2020-21, following allegations around a ₹20 billion transaction involving its operations and maintenance business.

The complaint alleged that Suzlon sold its operations and maintenance unit to subsidiary Suzlon Global Services Ltd. for ₹20 billion through 'circuitous' entries worth ₹13 billion, inflating the company’s net worth. Questions were also raised about the subsidiary’s ability to generate such cash flow within 90 days of the deal.

SEBI’s investigation evaluated possible violations under the SEBI Act, 1992, the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003, and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

“Since, violations as alleged are not established, therefore, ISSUE-II (whether a monetary penalty could be charged) and ISSUE-III (the quantum of the monetary penalty) do not require any consideration,” SEBI’s adjudicating officer said in the order, effectively clearing the company of all charges.