SEBI, barred 3 Independent Directors of Pyramid Saimira Theatre Ltd. (PSTL) from being an independent director or a member of audit committee of any listed company for a period of two years from March 11, 2011, for approving inflated profits of the company as member of audit committee.
SEBI order states that Pyramid Saimira Theatre Ltd. (PSTL) inflated its profits and revenues by fictitious entries in its accounts,disclosed the same in quarterly and annual results for the financial year 2007-08 and thereby misled the public in their investment decisions.
Mr. K. S. Kasiraman, Mr. K.Natarahjan and Mr. G. Ramakrishnan, who were independent directors of PSTL and members of its audit committee at the relevant time, have failed in their duty of care as an independent director and also they have failed to review, as members of the audit committee, the internal control systems, which generated misleading financial statements. All these facilitated the company to make false and misleading disclosures and thereby created artificial prices and volumes in the securities of PSTL in the market, to the detriment of innocent investors.
