The Ministry of Heavy Industries (MHI) is expected to decide shortly whether to remove from the beneficiary list of its production-linked incentive (PLI) scheme for advanced chemistry cell (ACC) battery storage, reported PTI.
This development follows a severe interim order passed by SEBI alleging massive financial fraud at the Bengaluru-based corporation.
There is a “strong view” within the department favoring the immediate disqualification of the firm. The final decision will soon be placed before Heavy Industries Minister HD Kumaraswamy, who has just returned from an official visit to Kyrgyzstan, reported PTI.
“A final call will be taken in the coming days,” PTI quoted a source as saying.
Rajesh Exports under scanner
In a comprehensive 109-page ex parte interim order dated June 3, SEBI alleged that —traditionally a gold jewelry manufacturer and exporter—fabricated a staggering ₹15.15 lakh crore in revenues between FY21 and FY25. This means approximately 99.8% of the revenues attributed to its subsidiaries during this timeframe were materially misrepresented. Furthermore, the market regulator flagged illegal fund diversion, opaque related-party dealings, and severe disclosure failures tied directly to Elest Pvt Ltd and ACC Energy Storage Pvt Ltd, two entities central to the company’s lithium-ion cell venture.
Consequently, SEBI has barred Rajesh Exports’ promoter and Chairman, Rajesh Mehta, from buying, selling, or dealing in the company’s securities until further notice, while simultaneously ordering a fresh forensic audit of the corporate books. As the primary administrator of the battery storage PLI program, the MHI is closely scrutinizing the regulator’s findings to map out its next legal steps. Meanwhile, Mehta and Rajesh Exports have firmly denied SEBI’s allegations and maintained that they are fully cooperating with the ongoing investigation.
Rajesh Exports provided 400 GB docs to SEBI
said on Sunday that it has already provided 300 to 400 gigabytes of documentation to the Securities and Exchange Board of India (SEBI). However, the firm believes the market watchdog failed to locate the correct files, prompting the company to commit to resubmitting all required paperwork within 15 days to clarify the situation.
In an interview with PTI, the company’s founder and chairman, Rajesh Mehta, asserted that SEBI’s June 3 interim order—which accused the company of inflating revenues by ₹15.15 lakh crore between FY21 and FY25—stems from a fundamental accounting miscalculation. Mehta claimed that the regulator mistakenly extracted the company’s EBITDA figures and misclassified them as total top-line revenue.
“We had given them 300-400 GB documents, running into lakhs (of pages). I think they have not been able to find the correct documents. The whole confusion has happened there,” Mehta said.
“They have taken the EBITDA and termed it as revenue. EBITDA means gross profit. They have taken the gross profit and termed it as revenue. Looking at the number ( ₹15.15 lakh crore), they have made a huge mistake,” he added.
To illustrate the alleged oversight, Mehta used a retail jewelry store analogy. He explained that in a high-volume, low-margin operation like Rajesh Exports’ gold bullion enterprise, a customer purchasing 2 grams of gold for ₹30,000 generates ₹30,000 in revenue. From that transaction, the gross profit might be ₹1,000 and the net profit ₹500. Mehta argued that SEBI erroneously recorded the ₹1,000 gross profit as the base revenue figure instead of the full ₹30,000 invoice amount. Applying this rationale to the broader corporate scale, he noted that the company routinely buys gold for ₹100 and sells it for ₹101, yielding a gross profit of Re 1; it is this single rupee, Mehta alleges, that SEBI misconstrued as the actual revenue rather than the true ₹101 sales turnover.