Mumbai: Shares J Kumar Infraprojects Ltd on Wednesday surged 20% after market regulator Securities Exchange Board of India (Sebi) cleared the company from charges of misrepresenting books of accounts.

The stock touched a high of 154.35 on BSE and rose as much as 20%, its maximum gains since 18 December 2018. At 10.03 am, the stock traded at 144.85 on BSE, up 13% from its previous close. So far this year, it has gained 9%.

"There are no reasonable grounds to believe misrepresentation of financials at J. Kumar Infraprojects, which had figured among 331 suspected shell companies", said Sebi in its 7 October order

In September last year, Sebi directed exchanges to appoint an independent auditor to conduct forensic audit of J Kumar to verify misrepresentation, including financial or operational activities of the company. It also asked exchanges to look into the role of key management personnel, directors and promoters.

"On the overall examination of various circumstances, I find that, in view of the materials adduced by JKIL, there are not adequate circumstances forming the reasonable grounds to believe that there is misrepresentation of financials", the Sebi order said.