Share India Capital Services Pvt Ltd has settled adjudication proceedings initiated by the Securities and Exchange Board of India (SEBI) by paying a settlement amount of ₹36.07 lakh, ending regulatory action related to alleged disclosure lapses in a small and medium enterprise (SME) initial public offering (IPO) handled by the merchant banker.
SEBI had initiated adjudication proceedings against Share India Capital Services under Section 15-I of the SEBI Act, 1992, for alleged violations of provisions under the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, and the SEBI (Merchant Bankers) Regulations, 1992. The proceedings stemmed from the company’s role as a merchant banker in the IPO of Archit Nuwood Industries Ltd, an SME.
According to SEBI, the merchant banker failed to disclose the true and adequate factual position regarding the sanction of a loan by AU Finance Bank under the ‘objects of the issue’ section of the offer document. The regulator alleged that this omission amounted to a misstatement, potentially impairing investors’ ability to make informed investment decisions.
Based on these observations, SEBI issued a show cause notice (SCN) on 25 April 2025, calling upon Share India Capital Services to explain why an inquiry should not be conducted and penalty imposed under Section 15HB of the SEBI Act for the alleged regulatory breaches.
While the adjudication proceedings were pending, the company filed a settlement application with SEBI under the SEBI (Settlement Proceedings) Regulations, 2018, seeking to resolve the matter without admitting or denying the findings of fact and conclusions of law.
The proposed settlement terms were first examined by the SEBI internal committee (IC), which initially recommended a settlement amount of ₹32.17 lakh. However, following further review and a remand by the high-powered advisory committee (HPAC), the IC reconsidered the matter and subsequently recommended a higher settlement amount of ₹36.07 lakh.
The revised settlement proposal submitted by Share India Capital Services was found to be in line with the IC’s recommendation. The HPAC agreed with the revised terms and recommended acceptance of the settlement.
The proposal was thereafter placed before the panel of whole-time members (WTM) of SEBI, which approved the settlement on 20 January 2026. SEBI issued a demand notice on 29 January 2026, and the company remitted the settlement amount of ₹36.07 lakh on 4 February 2026, receipt of which was confirmed by the regulator.
In view of the payment, SEBI disposed of the adjudication proceedings against Share India Capital Services in terms of Section 15JB of the SEBI Act read with Regulation 23(1) of the Settlement Proceedings Regulations.
SEBI clarified that the settlement order would be without prejudice to its rights to initiate or restore proceedings in the future if it emerges that the company failed to make full and true disclosures, violated undertakings, or if discrepancies are found in arriving at the settlement terms.
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