Jewellery exporting firm Rajesh Exports has denied the findings in a regulatory order passed against it, even as market regulator SEBI barred its promoter and MD Rajesh Mehta from dealing in the company's securities until further notice.
"It is an interim order and nothing in it is true," Mehta told Moneycontrol on Thursday, a day after SEBI passed its order. "We are in the process of studying it and will prepare a response," he added.
What Did SEBI Say
On June 3, SEBI passed an interim ex-parte order against Rajesh Exports Ltd (REL) and Mehta, citing prima facie findings of financial misrepresentation, fund-routing irregularities and non-cooperation during an ongoing investigation.
1 June 2026
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In its 109-page order, the regulator said its investigation revealed misrepresentation in financial statements, as well as instances of routing and layering of funds through personal accounts and related entities, without adequate disclosures or supporting documentation.
SEBI noted that 97–99% of Rajesh Exports' consolidated revenue came from overseas subsidiaries, particularly Switzerland-based Valcambi SA, but the company did not disclose its subsidiaries' financials in the public domain.
The regulator alleged that Rajesh Exports thereby misrepresented around ₹15.15 lakh crore of revenues, accounting for 99.80% of its revenues from subsidiaries between FY2020-21 and FY2024-25.
SEBI further alleged that these were non-genuine entries linked to Mehta's personal derivative trades, used to inflate turnover without real economic activity. The order held that Mehta was the key decision-making authority within REL and exercised substantial control over the day-to-day affairs and financial operations of the company and its subsidiaries.
SEBI also flagged non-cooperation by REL's statutory auditors. According to the order, the auditors, during their deposition, promised to provide audit working papers but eventually failed to do so. The regulator said such sustained non-cooperation is indicative of an intent to suppress material information and obstruct regulatory inquiry.
The markets watchdog said the company was issued repeated summons and given several opportunities to furnish true and fair financial statements, along with complete records explaining the end-use, business rationale, and ultimate beneficiaries of fund flows, but there was no satisfactory response.
SEBI directed REL and Mehta to cooperate with the investigating authority and furnish all documents and explanations sought within 30 days. It also ordered the appointment of a new forensic auditor to complete the audit of the company's books, citing inadequate cooperation during the earlier forensic exercise.
Additionally, the regulator directed the company to make true and fair disclosures of its financial statements, related party transactions, and other disclosures under the Listing Obligations and Disclosure Requirements (LODR) regulations.
Notably, the order came after SEBI received a complaint on March 11, 2024, from a shareholder of REL alleging potential financial misrepresentation in the company's books, specifically with respect to a large sum of trade receivables outstanding for more than two years.
Shares of Rajesh Exports fell 5% on Thursday to hit the lower circuit at ₹103.92.
