The Ministry of Heavy Industries (MHI) is set to decide in the coming days on removing Rajesh Exports from the list of beneficiaries under the production-linked incentive (PLI) scheme for advanced chemistry cell (ACC) battery storage, after the SEBI last week passed an interim order alleging massive financial fraud by the Bengaluru-based firm.

Sources in the ministry told PTI that there is a "strong view" within the department that the company should be dropped from the scheme.

The matter will be placed before Minister of Heavy Industries H D Kumaraswamy, who has returned from an official trip to Kyrgyzstan. "A final call will be taken in the coming days," a source said.

In a 109-page ex parte interim order dated June 3, SEBI alleged that Rajesh Exports - primarily a gold jewellery manufacturer and exporter - inflated revenues by ₹15.15 lakh crore between FY21 and FY25, amounting to approximately 99.8% of the revenues attributed to its subsidiaries over the period being materially misrepresented.

The regulator also alleged fund diversion, opaque related-party transactions, and disclosure failures involving two entities linked to the company's lithium-ion cell business: Elest Pvt Ltd and ACC Energy Storage Pvt Ltd.

SEBI has barred Rajesh Exports promoter and chairman Rajesh Mehta from buying, selling, or dealing in the company's securities pending further proceedings, and has ordered a fresh forensic audit of its books.

The MHI administers the battery storage PLI programme and is now examining the Sebi order to determine next steps.

Mehta and Rajesh Exports have denied Sebi's findings and stated they are cooperating with the investigation.

(Except for the headline, Fortune India has not edited the content of this PTI report.)