K Raheja Managers clears REIT rules Violation Case with Rs. 68.73 lakh Settlement Fee

On Thursday, K Raheja Investment Managers paid Rs. 68.73 lakh as a settlement fee to the Securities and Exchange Board of India (SEBI), the capital markets regulator, to resolve a case involving alleged violations of REIT regulations in the Mindspace Business Parks REIT case.

Mindspace Business Parks REIT is managed by K Raheja Investment Managers LLP, which is currently also known as K Raheja Corp Investment Managers Pvt Ltd.

In August 2020, the K Raheja Corp group-sponsored Mindspace Business Parks REIT went public on the Indian stock exchanges. It has office portfolios in Chennai, Hyderabad, Pune, and the Mumbai Region.

Following the noticee's (K Raheja Investment Managers LLP) proposal to resolve the current actions brought against it without "admitting or contesting the findings of facts and conclusions of law," the settlement order was issued.

In the case of Mindspace Business Parks REIT, the SEBI commenced adjudication procedures against K Raheja Investment Managers LLP for allegedly violating the REIT (Real Estate Investment Trusts) regulations.

On August 24, 2023, the markets watchdog then sent K Raheja Investment Managers a show-cause notice for allegedly breaking the rules.

K Raheja Investment Managers allegedly made mistakes when computing the net distributable cash flows (NDCF) data at the Special Purpose Vehicle (SPV) level, according to the show cause notice. Additionally, they disclosed NDCF in half-yearly and annual reports in an inaccurate and incomplete manner.

Speaking to this, SEBI’s adjudicating officer Asha Shetty said in the order, “In view of the acceptance of the settlement terms and the receipt of settlement amount by SEBI, the instant adjudication proceedings initiated against the noticee (K Raheja Investment Managers) dated August 24, 2023, is disposed of in terms of the settlement regulations”.

Recently, the NCLAT has relieved Raheja Developers by limiting the insolvency proceedings against the real estate firm to just one of its projects, 'Raheja Shilas.'

Navin Raheja, Chairman and Managing director of the suspended board of the real estate firm, filed a petition challenging an order from the NCLT directing the initiation of corporate insolvency resolution proceedings (CIRP) against it.