Sebi penalises LCC Infotech, 6 others for misrepresenting financial statements
LCC Infotech and its promoters — Kirti Lakhotia, Sidharth and Pratik Lakhotia — for misrepresenting the financial statements of the company. The regulator levied a penalty of Rs 6 lakh on LCC Infotech and a Rs 1 lakh fine each on Kirti Lakhotia (Chairperson and MD), Sidharth Lakhotia (CEO), Pratik Lakhotia, Kamaljit Singh, Rajat Sharma and Mayur P Shah.
In a 39-page order, Sebi found that LCC misrepresented its financial statements for FY 2021-22 by not making provisions/impairment on loans, debtors and investments as per applicable accounting standards and did not make certain disclosures about related party transactions in the annual report for the FY 2019-20, FY 2020-21 and FY 2021-22.
Sebi observed that Kirti Lakhotia, as managing director (MD), failed in her duty to ensure accurate financial reporting, neglected to oversee related party transactions effectively, and disregarded the necessary disclosures under Sebi disclosure rules.
By allowing misrepresentations in financial statements and omitting key disclosures, Kirti not only compromised the company's transparency but also failed to uphold the fiduciary responsibility expected at her level, the regulator said in the order.
Similarly, Sebi found that Sidharth and Pratik in their executive roles endorsed inaccurate financial statements and provided false certifications, thus misleading the board and undermining accountability.
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