The Securities and Exchange Board of India (SEBI) has issued an interim ex-parte order barring 10 entities and individuals, including Darjeeling Industries Limited (DIL) Managing Director Ashok Dilipkumar Jain, from buying, selling, or dealing in the company’s securities in connection with an alleged corporate fraud.
According to the market regulator, its preliminary findings indicate suspected misleading corporate disclosures, diversion of funds raised through a preferential issue, and actions that may have misled investors. A detailed investigation into the matter is continuing.
According to SEBI, the interim order was issued amid concerns that the entities concerned could sell shares allotted under the company’s preferential issue after the expiry of the lock-in period and potentially derive wrongful gains. The regulator clarified that the action is intended to safeguard investor interests while the investigation remains ongoing.
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During an inspection, SEBI found that Darjeeling Industries was not operating from its registered office in Girgaon, Mumbai. Investigators discovered that another company had been occupying the premises since July 2024. Despite this, DIL allegedly continued to submit corporate announcements and board meeting disclosures to the stock exchange from the same address. SEBI’s preliminary assessment suggests that these disclosures may have been fabricated or misleading to induce investors to invest in the company’s securities.
According to the regulator’s order, when SEBI’s inspection team visited the registered office on June 24, 2026, it found no evidence of the company’s operations. However, on the very same day, DIL informed the Bombay Stock Exchange (BSE) that its Board of Directors had met to consider the receipt of funds against warrants issued by the company. Investigators have identified this apparent contradiction as a significant aspect of the ongoing probe.
SEBI further observed that after Ashok Dilipkumar Jain joined the company as a director in October 2024, Darjeeling Industries reported a sharp increase in revenue and profits despite having negligible or zero operating revenue in previous financial years. During the same period, warrants were preferentially allotted to entities allegedly connected to Jain, while the company reportedly received funding primarily from him and related entities. The regulator also found indications that funds raised for the company’s stated growth objectives were transferred to entities with no apparent connection to DIL’s declared business activities.
The regulator additionally noted that despite reporting zero operating revenue during FY2023 and FY2024, the company’s share price and trading volumes witnessed a significant rise. Investigators also found that the company was not functioning from either of its registered addresses in Mumbai or Rajkot. SEBI has further questioned the company’s claims of diversification into unrelated capital-intensive businesses, noting that even its subsidiary was reportedly not operating from the disclosed address.
According to SEBI, shares allotted under the preferential issue accounted for approximately 66.26% of the total allotment. Based on prevailing market prices, the regulator estimated the potential value of these holdings at around ₹29.05 crore. However, SEBI clarified that this figure does not represent actual wrongful gains but rather the potential gains that could have accrued had regulatory intervention not taken place.
Apart from Ashok Dilipkumar Jain, the interim restraining order also applies to Dilip Keshrimal Sanklecha, Viha Ashok Jain, Sonali Abhaykumar Parmar, Abhishek Prakash Jain, Kirti Ravi Kothari, Kalidas Vijay Magar, Pradeep Sutodiya, Joy Banerjee and Punyah Sachin Jain. SEBI has directed all the noticees to cooperate fully with the ongoing investigation, stating that a detailed inquiry into the alleged violations and the possible involvement of additional persons will continue.
