Sebi bars Bhushan Steel promoters, 256 others for money laundering and tax evasion

Crisis-hit Bhushan Steel faces fresh troubles as four of its promoters figure among 260 entities barred by regulatory body Securities and Exchange Board of India (Sebi) for suspected money laundering and tax evasion activities through stock markets.

Those barred by market regulator Sebi include, company chairman Brij Bhushan Singal, his son and MD Neeraj Singal, as also their respective spouses Uma Singal and Ritu Singal.

All four of them were allotted shares on preferential basis by Radford Global and First Financial - the two firms at the centre of a massive Sebi crackdown on misuse of this route of share allotment to launder money and avoid taxes.

In its orders, Sebi said last Friday (Dec 19) that the modus operandi of the barred entities typically involved stock market dealings aimed at evading long-term capital gains tax and showing the source of income as legitimate from stock markets.

"... The schemes, plan, device and artifice employed in this case, apart from being a possible case of money laundering or tax evasion which could be seen by the concerned law enforcement agencies separately, is prima facie also a fraud in the securities market in as much as it involves manipulative transactions in securities and misuse of the securities market," the capital market watchdog said.

While further probe is continuing by the capital market regulator along with other agencies such as the Income Tax Department, the Enforcement Directorate and the Financial Intelligence Unit, all the 260 entities, including four from the Singal family, have been barred from all kinds of dealings in securities markets till further directions through an interim order.

No reply was available to queries made to Bhushan Steel, which is already in the dock for a 'cash-for-loan' scam involving Syndicate Bank. The company is facing probe by the Central Bureau of Investigation (CBI) in relation to alleged bribing of top officials at public sector banks pertaining to their huge loans amounting to over Rs 40,000 crore.