Last update: 24 Oct 2022 12:17 IST

Edtech gets clean sweep from Sebi (representational image)

Following the allegations in 2016, Sebi launched an investigation covering the period from April 2011 to June 2017.

After a six-year forensic audit, Sebi has given a clean chit to Tree House Education & Accessories Ltd, its promoters and other officials in a case related to alleged misrepresentation of the company’s financials. In its letter to Tree House Education dated October 19, Sebi’s corporate financial investigations department wrote to the promoters that no action would be taken against the company after a forensic audit initiated by the regulator did not find any instances of financial concern.

“Sebi’s forensic examination and investigation is complete. Subject to the terms and conditions and reference to the forensic auditor and subsequent investigation by Sebi, no action is proposed against you,” the regulator’s letter said. The reprieve for the company comes after a six-year Sebi audit following baseless allegations.

Following the allegations in 2016, Sebi launched an investigation covering the period from April 2011 to June 2017. Subsequently, Sebi, in its interim order in 2018, restricted Tree House, its promoters — Rajesh Bhatia, Geetha Bhatia, Giridharilal S Bhatia — and two other officials from accessing the securities market and trading in any securities in a case involving alleged misrepresentations. financial indicators of the firm. The regulator ordered the NSE to appoint an independent auditor or an audit firm to conduct a detailed forensic audit of Tree House’s books of accounts.

The auditor was asked to check the manipulation of accounting books and misrepresentation, including the financial and business operations of Tree House. In addition, the auditor had to check any misappropriation or siphoning of company funds through “related party transaction”.

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