Authority: Amarjeet Singh, Whole Time Member, Securities and Exchange Board of India
Order Date: August 28, 2026
Case Overview
The proceedings emanate from an investigation into the Initial Public Offer (IPO) of Trafiksol ITS Technologies Ltd (TITL), which was proposed to be listed on the BSE SME Platform. The company had filed a Draft Red Herring Prospectus (DRHP) on May 31, 2024, for an IPO comprising a fresh issue of 64.10 lakh shares in a price band of ₹66-70 per share, raising ₹44.87 crore. The IPO was oversubscribed 345.65 times and priced at ₹70 per share. Key objects of the issue included purchase of software (₹17.70 crore), repayment of borrowings (₹5.50 crore), working capital (₹10.40 crore), general corporate purposes (₹8.28 crore), and issue expenses (₹2.99 crore).
Post-allotment, complaints were received alleging discrepancies in the proposed use of proceeds for procuring software from Oasis Corpcare Pvt Ltd (OCPL), which appeared incapable of executing the contract. SEBI passed an interim order on October 11, 2024, directing BSE to place IPO proceeds in an escrow account and initiated a detailed investigation. Subsequently, SEBI's order dated December 3, 2024, directed TITL to refund investor money and cancel allotted shares, which was upheld by the Securities Appellate Tribunal (SAT) on January 24, 2025.
The present proceedings cover remaining findings not addressed in the December 2024 order, including misleading financial disclosures, concealment of material facts, and submission of false information. The noticees are TITL (Noticee 1), Mr. Jitendra Narayan Das (Noticee 2, Chairman and Managing Director), and Ms. Poonam Das (Noticee 3, Whole-Time Director), who are promoters of the company.
Principal allegations included:
- Inflation of revenue and purchases for FY 2023-24 by ₹13.4 crore through circular transactions with Limco Global Services and Ishira Global Service, involving back-to-back invoicing with standard mark-ups and direct shipment of goods.
- Recording of unsupported unbilled revenue of ₹4.50 crore on March 31, 2024, through journal entries for Limco, TP Central Odisha Distribution, and TP Western Odisha Distribution.
- Misleading disclosure of top customers and suppliers by netting sales and purchases with Limco and Ishira, obscuring the true concentration of business relationships.
- Omission of ₹45 lakh paid to Topfilings India Pvt Ltd for IPO-related consultancy from issue expense disclosures.
- Concealment of a financial arrangement involving payment of ₹67 lakh to Mr. Prakash Jhunjhunwala (father of ECPL director) for office space, creating a potential conflict of interest with the merchant banker.
- Reliance on a fabricated quotation from Oasis Corpcare for procurement of Integrated Command Control Centre software worth ₹17.70 crore, obtained through a middleman (Mr. Vijay Oswal) for a commission.
Final Outcome
SEBI found TITL violated:
- Regulations 245(1) and 245(2) of ICDR Regulations for false and inadequate disclosures in the offer document.
- Section 12A(a),(b),(c) of SEBI Act and Regulations 3(b),(c),(d), 4(1), 4(2)(f),(k),(s) of PFUTP Regulations for fraudulent and unfair trade practices.
- Section 11(2)(ia) read with 11C(3) of SEBI Act for furnishing false information during investigation.
Mr. Jitendra Das and Ms. Poonam Das were held liable for the company's violations under Section 27 of SEBI Act. SEBI imposed the following directions:
- All noticees are restrained from accessing the securities market and prohibited from buying, selling, or dealing in securities for one year.
- Monetary penalties imposed:
- TITL: ₹30 lakh (₹5 lakh under Section 15A(a), ₹20 lakh under Section 15HA, ₹5 lakh under Section 15HB)
- Mr. Jitendra Das: ₹50 lakh (₹5 lakh under Section 15A(a), ₹40 lakh under Section 15HA, ₹5 lakh under Section 15HB)
- Ms. Poonam Das: ₹25 lakh (₹20 lakh under Section 15HA, ₹5 lakh under Section 15HB)
- Noticees permitted to close open derivative positions within three months.
Topics: IPO Fraud, Financial Misrepresentation, SEBI Enforcement