Sebi has imposed a fine of Rs.10 lakh on Krishna Enterprises and Rajesh Services Centre, for helping Edserv Softsystems for siphoning off the money from its IPO proceeds fraudulently.

The investigation was carried on by Sebi into the IPO of Edserv on NSE for the period from March 2-9,2009 and on BSE from March 2-6,2009. It was found out during the investigation that, Rs.4.75 crore had been siphoned off fraudulently from Edserv and certain entities including Krishna Enterprises-K Rajendran being its sole proprietor- and Rajesh Services Centre-R Dhanalakshmi being its sole proprietor, helped the firm in moving out the funds.

Further, in an order Sebi stated that, Krishna Enterprises and Rajesh Services Centre had diverted Rs.1.5 crore and Rs.2.25 crore, respectively, out of Rs 3.75 crore received from Edserv and had in collusion with it, acted as layers in transferring the entire sum to Mahadev Impexs, Shiv Impexs, S K Alloys & Trading and Ramco International either on same day or the next day. Therefore, for the violation, Sebi has imposed a penalty of Rs.5 lakh each on both the entities.

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