sebi:AO/SBM/EAD-1/01/2019
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Facts / Headnote
Penalty imposed on Noticees
Provisions invoked
- s. 11
- s. 15A
- s. 15
- s. 15H
- s. 15J
- s. 11C(6)
- s. 11C(2)
- s. 8(1)
Regulations
- Reg. 7
- Reg. 200
- Reg. 8
- Reg. 8(1)(a)
- Reg. 8(1)
Parties
- Ms Poonam Gupta
- Mr Harsh Gupta
- Mr Rajat Gupta
- Mr Ramesh Gupta
Holding
The Noticees were held liable for submitting fake contract notes and false/misleading information to the investigating authority of SEBI, thereby violating sections 11C(6)(a) and 11C(6)(b) of the SEBI Act, and a total penalty of Rs 8,00,000/- was imposed jointly and severally under section 15HB. The charge of non-cooperation under Regulation 8(1)(a) of the PFUTP Regulations was held not sustainable.
Full text
Page 2 of 21 registration no. INB 2308735534. During the course of investigation by SEBI, it emerged that there was no member/broker by the name of AMI Securities with SEBI Regn no. INB 2308735534 registered with SEBI during the period when the alleged fake contract notes were issued. Further, while the said contract notes were purportedly issued for the transactions done in the scrip of RFL on the National Stock Exchange (NSE), it is observed that the scrip of RFL was listed only on the Bombay Stock Exchange (BSE) and not on NSE during the period of investigation i.e March 26, 2011 to April 20, 2011 ( hereinafter referred to as ‘Investigation period’/’IP’/ ‘relevant period’). It was noted that the scrip of RFL was not listed on NSE during the period when the above mentioned contract notes were issued. Therefore, it is alleged that the contract notes submitted by Noticee Nos 1 to 3 were fake documents.
Page 3 of 21 view of the above reasons, adjudication proceedings were initiated by SEBI against the Noticees under the provisions of section 15HB of the SEBI Act.
Page 4 of 21 (ii) It is alleged that Noticees submitted false/misleading information/details to the IA of SEBI during the course of investigation and allegedly made incorrect statements with regard to the chronology of events relating to the purchase of shares of RFL, proof of purchase of the shares, proof of payment, details of person who provided them the contract notes, documentary evidence of maintaining trading account with AMI Securities and detailed computation of the capital gains on sale of shares etc. (iii) In view of the above, it was alleged that Noticees were liable for
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Source: SecMarx — sebi:AO/SBM/EAD-1/01/2019. 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.