sebi:14617

SEBI · SEBI · 2003-07-24 · V. K. CHOPRA, WHOLE TIME MEMBER

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Facts / Headnote

Minor penalty imposed: suspension of certificate of registration for one month

Provisions invoked

• s. 11
• s. 19

Regulations

• Reg. 13(4)
• Reg. 15
• Reg. 15(1)(b)

Parties

• M.S. Consultancy Services

Holding

The Noticee, a sub-broker, was held to have violated Clauses A(1), A(2), D(4) and D(5) of the Code of Conduct under Regulation 15 of the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992, and a minor penalty of suspension of its certificate of registration for one month was imposed.

Full text

FOR THE NOTICEE: Miss. Rachna Vats, Advocate Miss. Anagha Subramaniam, Advocate FOR SEBI: Mrs Barnali Mukherjee, DGM, SEBI Shri. Narendra Rawat, Asst. General Manager, SEBI Shri. Mohamed Rahaz P.M., Legal Officer, SEBI

2000 to July 26, 2000 when daily trading volumes were few hundred shares. 1.3 An internal investigation in the matter carried out by BSE revealed that the price and volume of MOH scrip were manipulated by certain connected entities by entering into fictitious transactions in the nature of circular trading. It was observed that there was no cogent reason for the price of the scrip to go up so steeply keeping in view financial performance of the company. BSE had imposed a special margin of 25% w.e.f. August 10, 2000 and this was subsequently increased to 50% w.e.f. September 04, 2000. The daily circuit filter was reduced from normal 8% to 4% from August 10, 2000 in view of abnormal increase in price of the scrip. 1.4 In view of the above facts and circumstances, Securities and Exchange Board of India (hereinafter referred to as “SEBI”)

Regulations”) to enquire into the affairs of the Noticee in his dealing in MOH scrip and possible violations of the provisions of SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 (hereinafter referred to as “Stock Brokers Regulations”). 2.2 The Enquiry Officer issued a notice of enquiry dated October 07, 2003 to the Noticee, who in turn vide his letter dated October 30, 2003 submitted its reply thereon. The Proprietor of the Noticee, Shri Mahendra Thakkar attended the hearing before the Enquiry Officer on December 30, 2003. 2.3 The Enquiry Officer, after conducting an enquiry in accordance with the provisions of Enquiry Regulations submitted a report dated July 01, 2004 wherein he observed that the Noticee had violated the provisions of Code of Conduct as specified in Schedule II of Regulation 15 of SEBI Stock Brokers Regulations. He recommended suspension of certificate of registration of the Noticee for a period of two months. 3.0 SHOW CAUSE NOTICE 3.1 Pursuant to the receipt of the said enquiry report, a show cause notice dated May 31, 2005 was issued to the Noticee, enclosing therewith a copy of the Enquiry Report to show cause as to why the action, recommended by the Enquiry Officer or such other action as may be deemed appropriate should not be imposed on the Noticee. 4.0 REPLY OF THE NOTICEE TO THE SHOW CAUSE NOTICE

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