Update: DLF moves Securities Appellate Tribunal against Sebi's capital market ban

DLF, the country's real estate giant, on Friday filed an appeal before the Securities Appellate Tribunal (SAT) against a Securities and Exchange Board of India (Sebi) order banning it and six top executives from capital markets.

According to sources, the appeal is likely to be heard by SAT next week.

In a major blow to DLF, the capital market regulator barred the real estate giant and six of its top executives, including Chairman and main promoter KP Singh, from the securities market for 3 years for "active and deliberate suppression" of material information at the time of its initial public offer (IPO) in 2007.

While Sebi did not impose any monetary penalty, the prohibition has barred DLF and the six persons, from any sale, purchase or any other dealings in securities markets for a period of three years, including for raising funds.

DLF had debt of over Rs 19,000 crore as on June 30, 2014, while its already-proposed fund raising plans include nearly Rs 3,500 crore through issue of certain bonds to replace its costlier debt.

This was one of the rare orders by the capital market watchdog where it barred a blue-chip firm and its top promoter/executives from the market.

On Tuesday, DLF's shares had slumped nearly 30 per cent, eroding the real estate giant's market value by about Rs 7,500 crore.

However, the stock regained some lost ground in its next trading session on Thursday.

DLF is the largest real estate group in the country with an annual turnover of nearly Rs 10,000 crore.

DLF's IPO in 2007 had fetched Rs 9,187 crore - the biggest IPO in the country at that time.

Besides KP Singh, those barred from the markets include his son Rajiv Singh (Vice Chairman), daughter Pia Singh (Whole Time Director), Managing Director TC Goyal, former CFO Ramesh Sanka and Kameshwar Swarup, who was ED-Legal at the time of the company's public offer in 2007.

On October 13, DLF had said it had not violated any laws and it would defend its position against any adverse findings in the Sebi order.

"DLF has full faith in the judicial process and is confident of vindication of its stand in the near future," the statement had said.

After a probe lasting over four years, the market regulator found that a "case of active and deliberate suppression of any material information so as to mislead and defraud the investors in the securities market in connection with the issue of shares of DLF in its IPO is clearly made out in this case".

Sebi's Whole-Time Member Rajeev Agarwal, in his 43-page order,  also said that violations were grave and had larger implications on safety and integrity of the securities market.