Authority: Adjudicating Officer, Securities and Exchange Board of India
Order Date: September 28, 2026
Case Overview
This adjudication order concerns Madhukar Dubey and his proprietorship firm Magnum Industrial Corporation (Noticee 2) in the matter of fraudulent funding of Channel Nine Entertainment Limited's (CNE) Initial Public Offering (IPO) in February 2013. The IPO raised ₹1171.50 lakhs, with CNE transferring ₹1140 lakhs to various entities on the same day funds were received from escrow, including ₹500 lakhs to funding group entities.
The Noticee was part of a group of 8 entities that funded IPO applications through a fraudulent scheme to ensure minimum subscription and successful listing on BSE's SME platform. Specifically, Magnum Industrial Corporation issued 20 cheques of ₹1.50 lakhs each (total ₹30 lakhs) from account xxxxxxxxxxx2209 to fund 20 non-ASBA retail investors who received allotment of 1,20,000 shares. These funds were received by Magnum from N.V. Sales Corporation (another Dubey proprietorship) on February 28, 2013.
The Noticee contended he was merely a driver for Vijay Jindal (2010-2015) who misused his credentials to open and operate the proprietorship firms without his knowledge. He submitted a private handwriting expert report and claimed he attempted to file a police complaint against Jindal (deceased) but was unsuccessful. SEBI found these defenses unsubstantiated and noted conflicting statements across proceedings.
Final Outcome
The Adjudicating Officer found Madhukar Dubey and Magnum Industrial Corporation violated Regulations 3(a), (b), (c), (d) and 4(1) of SEBI PFUTP Regulations, 2003 read with Section 12A(a), (b) and (c) of SEBI Act, 1992. A penalty of ₹5,00,000 (Rupees Five Lakhs Only) was imposed under Section 15HA of SEBI Act, payable within 45 days. Failure to pay may lead to recovery proceedings under Section 28A including attachment of properties.
- Topics: SEBI Enforcement, IPO Fraud, Market Manipulation