SEBI bars...

Responding to the order, the company said, “DLF will defend itself to the fullest extent against any adverse findings and meas ures contained in the order passed by Sebi. DLF has full faith in the judicial process and is confident of vindication of its stand in the near future.”

It was unclear how the firm’s lenders, often the real estate industry’s lifeline, would react to the investigation that looked into charges of failure by the company to properly disclose its relationship with subsidi ary firms.

“It can be very damaging for the company,” said lawyer Hiroo Advani. “This could lead them to struggle to complete ongoing projects. Also, if banks start calling in their loans, it would further compound the adverse impact.”

The ruling could also have an adverse impact on the firm’s stock. News of the Sebi ban broke after trading had closed on Indian stock exchanges, when DLF shares were down 3.7% at Rs 146.70 on the Bombay Stock Exchange.

The order came after a four year probe into the process of share transfer by three DLF sub sidiaries in three other allegedly related firms -- Sudipti, Shalika and Felicite.

In April 2010, the Delhi high court had asked Sebi to look into the complaint of one Kimsuk Krishna Sinha on the dealings

Calling the share transfer process a “sham transaction” Sebi said the banned execu tives employed “a plan, scheme design and device to camouflage the association” of DLF with these three entities.

This is the second setback for the Delhi-based developer in two weeks. Last week, the Delhi HC dismissed the company’s peti tion seeking a stay on investiga tions by the anti-trust regulator Competition Commission of India into allegations of anti competitive practices.

DLF executives barred by Sebi include KP Singh’s son Rajiv Singh (vice-chairman) daughter Pia Singh (whole-time director), TC Goyal (managing director), Kameshwar Swarup and Ramesh Sanka. All these people, including KP Singh and his two children, were part of the top management at the time of filing IPO documents.

About G S Talwar, also a non executive director at that time Sebi said it could not be estab lished whether he was involved in day-to-day operations and was therefore given the “benefit of doubt”.

In a statement, the company however, reassured “investors and all other stakeholders that it has not acted in contravention of law either during its initial public offer or otherwise”.

“DLF and its board were guided by and acted on the advice of eminent legal advi sors, merchant bankers and audit firms while formulating its offer documents,” the release