sebi:15107

SEBI · SEBI · 2005-12-07 · G. Anantharaman, Whole Time Member

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Facts / Headnote

Show cause notice dated December 07, 2005 disposed of; no directions issued under section 11B.

Provisions invoked

• s. 11B
• s. 11
• s. 19

Parties

• Delhi Stock Exchange Association Ltd.

Holding

No directions are issued against the Delhi Stock Exchange Association Ltd. under section 11B of the SEBI Act, 1992, and the show cause notice dated December 07, 2005 is disposed of.

Full text

Appearances : For noticee : Shri Vinay Gupta, Director Shri I C Singhal, Director Shri V. Shankaran, Asst. General Manager For Securities and Exchange Board of India: Ms Barnali Mukherjee, Dy. General Manager, 1.0

Rs.300/- , whereas the price at BSE on the said date was Rs. 95.05/-. 1.2 Securities and Exchange Board of India (hereinafter referred to as SEBI) conducted investigations into the listing and trading of the shares of STIL on BSE and DSE. It was noticed that there was no trading in the shares of the said company between May 13, 1999 to August 09, 2000 and the last trade prior to August 2000 took place at Rs. 2.15/- on May 13, 1999. It was further noticed that, at the time of the said listing of the shares of STIL at DSE, DSE had set the ‘Yesterday’s Closing Price’ (hereinafter referred to as YCP) at ‘0’ for the said shares and did not apply any circuit filters on the first day of its trading, which was the procedure followed for a newly listed scrip. It was alleged that, as the shares of STIL were already listed at BSE, DSE should have taken the YCP of the said shares on BSE as the base price and should have applied the circuit filters on the said price. 1.3 In view of the above facts and circumstances, it was alleged that DSE had facilitated the manipulation of the price of the shares of STIL, by not taking the YCP of the said shares at BSE and fixing the circuit filter, as mentioned above. It was further alleged that the high price of the shares of STIL at DSE had created artificial demand for the said shares at BSE and the same had also created scarcity of sell orders. It was also alleged that the promoters of STIL took advantage of this price difference and through their

directions under section 11 B of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as the Act) should not be issued against it. 2.0 CONSIDERATION OF ISSUES AND FINDINGS 2.1 DSE vide letter dated December 22, 2005 inter alia stated that the shares of STIL had already started trading at BSE in the name of Shreejee Yatayat India Ltd. before the same was listed at DSE. It was stated by DSE that, even before the shares of STIL had started trading at DSE, the quantity of shares of STIL traded at BSE were to the tune of 50, 100 and 50 shares on August 09, 2000, August 11, 2000 and August 14, 2000 , respectively. It was further stated that, in terms of the daily quotation list of BSE for August 10, 2000, the name of STIL was indicated as Shreejee Yatavat India Ltd. DSE stated that, it was not aware that the shares of STIL were already traded at BSE and further stated that, had the name of STIL appeared correctly in the official quotation list of BSE, it would have picked up the YCP and fixed the rate accordingly. 2.2 It was the contention of DSE that, it came to know the disparity of the prices of the shares of STIL ( between DSE and BSE ) only on August 17 - 18, 2000. DSE further stated that, if YCP at that stage was revised according to the price prevailing at BSE, the investors who had bought the said shares above Rs. 300/- would have incurred huge losses. DSE further stated that BSE had fixed the 8% upper circuit filter on the basis of volume of 50 shares

Source: SecMarx — sebi:15107. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.