sebi:AO/AS/03/2014
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Facts / Headnote
Violations established; monetary penalty imposed on all 8 noticees
Provisions invoked
- s. 15A
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 7
- Reg. 4
- Reg. 3
- Reg. 7(1)
- Reg. 13
- Reg. 13(4)
- Reg. 11
- Reg. 10
- Reg. 12
- Reg. 13(3)
- Reg. 13(5)
- Reg. 7(2)
- Reg. 13(1)
Parties
- Shiv Kumar Agarwal (noticee no. 1)
- Rosydevi Agarwal (noticee no. 2)
- Roselabs Finance Ltd. (noticee no. 3)
- Madhudevi Agarwal (noticee no. 4)
- Singhal Overseas Ltd. (noticee no. 5)
- Sadiram Industries Ltd. (later merged with Roselabs Ltd.) (noticee no. 6)
- Pawankumar Agarwal (noticee no. 7)
- Roselabs Ltd. (noticee no. 8)
Holding
The Adjudicating Officer held that all eight noticees violated PFUTP Regulations, Regulation 10 of SAST (Takeover) Regulations, and Regulation 7/13 of Insider Trading/SAST Regulations by engaging in fraudulent off-market share transfers around misleading corporate announcements, failing to make public announcements upon crossing the 15% threshold, and failing to file required disclosures. Monetary penalties were imposed under Sections 15H, 15HA, and 15A(b) of the SEBI Act.
Full text
Page 2 of 20 Rosydevi Agarwal or noticee no. 2), Roselabs Finance Ltd. (hereinafter referred to as Roselabs Finance Ltd. or noticee no. 3), Madhudevi Agarwal (hereinafter referred to as Madhudevi Agarwal or noticee no. 4), Singhal Overseas Ltd. (hereinafter referred to as Singhal Overseas Ltd. or noticee no. 5), Sadiram Industries Ltd. (later merged with Roselabs Ltd.) (hereinafter referred to as Sadiram Industries Ltd. or noticee no. 6), Pawankumar Agarwal (hereinafter referred to as Pawankumar Agarwal or noticee no. 7) and Roselabs Ltd. (hereinafter referred to as Roselabs Ltd. or noticee no. 8) (all the noticees collectively hereinafter referred to as "Noticees") offloaded shares in the market through off market transfer in and around the time of misleading announcement made by the company which created artificial volume and impacted the price of the scrip thus defrauded the investors. They transferred shares in off‐ market and received back shares which triggered more than 15% of the paid up capital of the company before transferring again their entire holding in off market transaction, no public announcement was made and also they did not file disclosures as per the requirement of SEBI Regulations.
Page 3 of 20 Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 (hereinafter referred to as “Adjudicating Rules”) to enquire into and adjudge under:‐ a. Section 15H and 15HA of the SEBI Act for the entities mentioned at Sr. No. 1 to 8 above b. Section 15 A (b) of the SEBI Act for entities mentioned at Sr. No. 1 and 5 to 8 above
Page 4 of 20 7. Noticee no. 1 vide his letter dated 21‐Oct‐2009 and the other noticees vide their letters dated January 18, 2010 submitted their reply. It has been observed that the reply submitted by the noticees are similar. It has been submitted, inter‐alia, that:
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Source: SecMarx — sebi:AO/AS/03/2014. 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.