The complaint pertains to irregularities concerning the IPO of 55,00,000 shares through which Taksheel Solutions Limited raised ₹80.50 crore.
Enforcement Directorate.
The Enforcement Directorate arrested three men, including two non-resident Indians, in connection with the alleged scam related to the Initial Public Offer (IPO) of Taksheel Solutions Limited in Hyderabad, said the agency on Friday, 13 October.
Identifying the accused as Nirmal Kotecha, Pavan Kuchana, and Kishore Tapadia, the ED said they were booked under the Prevention of Money Laundering Act (PMLA), 2002.
Kotecha and Kuchana were living in the Republic of Vanuatu, an archipelago in the southwestern Pacific Ocean, and the US, respectively.
The ED initiated an investigation based on a complaint filed by the Securities and Exchange Board of India (SEBI) under Section 12 (A) read with 24 of the SEBI Act, 1992, against Taksheel, its promoters, directors, and others.
The accused, arrested on 11 October, were produced before the Metropolitan Sessions Judge (MSJ) Court at Nampally in Hyderabad on Thursday,12 October, the ED said.
The complaint pertains to irregularities concerning the IPO of 55,00,000 shares worth ₹10 each for which the issue price was fixed at ₹150. Taksheel raised ₹80.50 crore through the IPO.
The ED investigation revealed that Kuchana, Kotecha, and Tapadia charted out a strategy to inflate the revenue of Taksheel by issuing the IPO and subsequently diverting and siphoning off the IPO proceeds.
To facilitate the IPO issue, Kotecha arranged Inter-Corporate Deposits (ICDs) of ₹34.50 crore to Taksheel, the ED said.
The funds were routed through Kuchana’s US-based entities. Circular transactions were done with Taksheel before the IPO, resulting in incremental revenue and corresponding inflation of profitability. After the IPO, the ICDs were repaid from the IPO proceeds.
ED has arrested Nirmal Kotecha, Pavan Kuchana and Kishore Tapadia under the provisions of the PMLA, 2002 on 11/10/2023 in the case of Initial Public Offer (IPO) scam of M/s Taksheel Solutions Limited, Hyderabad. Nirmal Kotecha and Pavan Kuchana are presently residents of Republic…
— ED (@dir_ed) October 13, 2023
The ED investigation further revealed that out of the IPO proceeds of ₹80.50 crore, an amount of ₹34.50 crore was diverted and siphoned off to US-based entities of Kuchana on the pretext of payment for supply of services.
From these US-based entities, an amount of ₹30.50 crore was further transferred to Singapore and Hong Kong-based entities under the control of Kotecha.
Out of the IPO proceeds, another ₹23 crore was transferred to Indian entities in the guise of the purchase of software products and was eventually transferred to Kotecha’s entities based in Hong Kong and
Dubai.
The proceeds, ₹18 crore, were transferred from Taksheel to various individuals/entities on the pretext of IPO-related expenses, payments to vendors, STPI development expenses, salaries, etc.
The court has remanded the accused in judicial custody till 25 October. Further investigation is on, the ED said.
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