Chennai–The Securities and Exchange Board of India (Sebi) on Wednesday confirmed its interim ban order on 10 persons and one corporate connected with Dhyana Finstock Ltd from dealing in the securities market for evading tax using the preferential allotment and stock market mechanism.

The markets regulator confirmed its interim order issued on June 1, 2016 restraining the 11 entitites from dealing in the securities market.

The Sebi confirmed its interim order after it considered whether its June 1, 2016 order issued against the 11 entities/notices need to be confirmed, vacated or modified during the pendency of the investigation in the matter.

According to it, the modus operandi employed by Dhyana, its directors/promoters, preferential allottees and Dhyana group was to make a facade of preferential allotment.

After the expiry of the lock-in period, it purchased shares from the preferential allottees at artificially increased prices.

“In the whole process, entities of the Dhyana Group provided a hugely profitable exit to the preferential allottees,” Sebi said.

According to SEBI, the beneficiaries made a collective profit of Rs 107.43 crore on a collective investment of Rs 5.22 crore in a period of 20 months and claimed exemption from long term capital gains tax.