Sebi Bars Rajesh Exports CEO Rajesh Mehta Over Alleged Account Falsification and Fund Diversion

Capital markets regulator Sebi has stopped Rajesh Exports Ltd promoter and CEO Rajesh Mehta from buying or selling the company’s securities, citing suspected falsification of accounts and fund diversion. The interim order, issued on Wednesday and updated on June 4, 2026, also flags weak disclosures and concerns over cooperation by the company’s auditors.

Sebi’s inquiry said reported revenue at Rajesh Exports Ltd appeared inflated by about 97-99 per cent during the checked period. The order called this scale of mismatch prima facie “egregious and unheard of”. The regulator treated this as one of the most serious issues found in the case.

Sebi Rajesh Exports investigation details and financial statement concerns

The Sebi Rajesh Exports investigation began after a shareholder complaint on March 11, 2024. The complaint pointed to possible misstatement in the books and highlighted a large block of trade receivables outstanding for more than two years. Sebi then launched a probe covering transactions from April 1, 2020 to March 31, 2024.

During the Sebi Rajesh Exports investigation, the regulator issued several summons to Rajesh Exports Ltd seeking full, accurate financial statements and supporting records. Sebi also asked for details of the end-use of funds, the business reasons for movements, and the final beneficiaries. The responses, according to Sebi, remained incomplete and did not satisfy the questions raised.

Sebi Rajesh Exports fund flow findings and LODR directions

The Sebi Rajesh Exports interim order runs to 109 pages and records signs of routed and layered fund flows. Sebi alleged that money moved through personal bank accounts and related entities, with poor transparency. These transfers, the order said, lacked proper disclosures and adequate documentation. Sebi directed Rajesh Exports Ltd to present true and fair financial statements, including all related party transactions.

Alongside these findings, Sebi ordered tighter compliance with Listing Obligations and Disclosure Requirements, or LODR, rules. The Sebi Rajesh Exports order instructed the company to correct earlier LODR disclosures on related party dealings and fund flows. Sebi stressed that future filings must clearly show the nature of transactions and the movement of funds within the group.

Sebi Rajesh Exports order, audit cooperation and forensic review

The Sebi Rajesh Exports order also highlighted a lack of cooperation from the company’s statutory auditors. According to the order, the auditors initially agreed during deposition to provide audit working papers. Sebi said these documents were never submitted later. The regulator viewed this continuing non-cooperation as an attempt to conceal important information and as a barrier to the investigation.

Sebi added that earlier forensic review efforts at Rajesh Exports Ltd had faced inadequate cooperation. Because of this, the Sebi Rajesh Exports order appointed a new forensic auditor to re-examine the company’s books. The new auditor has been asked to complete a detailed review of financial records, including subsidiaries, and report findings to the regulator.

Sebi said Rajesh Mehta functioned as the key decision-maker at Rajesh Exports Ltd, with strong control over daily operations and finances across the company and its subsidiaries. On this basis, Sebi restrained Rajesh Mehta from dealing, directly or indirectly, in REL securities until further orders. Sebi also directed Rajesh Exports Ltd and Rajesh Mehta to assist investigators and submit all requested documents and explanations within 30 days, noting the story was first published on June 3, 2026.