According to SEBI Whole Time Member Kamlesh Chandra Varshney’s interim order, the regulator found that a base amount of around ₹25 crore was allegedly circulated repeatedly through a network of connected entities to create the appearance of fresh funding into Dhenu Buildcon. The regulator said the alleged arrangement involved round-tripping of funds and that the ultimate original source of the money remained unverified.
SEBI said Dhenu Buildcon purportedly received ₹1,000 crore from seven entities through 46 transactions over eight days. Despite the reported inflows, the company’s bank balance did not exceed around ₹26 crore during the period, while approximately ₹996 crore was transferred to five entities that were part of the same broader network, according to the order.
The regulator also noted commonalities among the entities involved, including links through persons, addresses, banking arrangements, shareholders and directors. SEBI said WhatsApp communications preceding the transactions contained discussions concerning Dhenu Buildcon, bank accounts, documentation, loan agreements, movement of funds and a proposed preferential allotment.
₹840 crore converted into equity
According to SEBI, around ₹840 crore of the purported loan liabilities were subsequently converted into equity shares of Dhenu Buildcon through a preferential allotment in December 2025.
The preferential allotment to six entities resulted in those entities holding approximately 99.70% of Dhenu Buildcon’s diluted equity share capital, the regulator said.
SEBI also said several entities involved did not appear to have operations or a physical presence during site visits, while their financial and operational profiles appeared disproportionate to the scale of transactions attributed to them.
“These circumstances, viewed cumulatively, give rise to a strong prima facie inference” of a coordinated arrangement involving round-tripping of funds, creation of purported unsecured loan liabilities and their subsequent conversion into equity, the regulator said. SEBI identified Surendra Kumar Jain and Virendra Jain as key conspirators in the alleged arrangement.
The regulator clarified that its findings are prima facie and do not amount to a final determination of the ultimate source of funds or the precise role of every person or entity involved. Those aspects, it said, require further investigation.
SEBI bars corporate actions
SEBI said the alleged conduct prima facie falls within the scope of fraudulent and unfair trade practices prohibited under Regulations 3(a), 3(b), 3(c) and 3(d) of the PFUTP Regulations.
In view of its findings, the regulator has issued interim preventive directions in the matter. Dhenu Buildcon has been barred from undertaking corporate actions until further orders, while six allottees have been restrained from disposing of or dealing with the shares allotted to them, as per the interim order.
SEBI said the alleged round-tripping had no apparent commercial substance and created the appearance of repeated fresh funding. The subsequent conversion of around ₹840 crore into equity, it said, compounded the effect of the arrangement by turning the purported loan claims into securities representing nearly the entire diluted equity capital of the company.
The interim order follows SEBI’s examination of the transactions and is subject to further proceedings and investigation.
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