sebi:AO/SBM/EAD-1/11/2019
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Facts / Headnote
Penalty imposed on Noticee for violation of PFUTP Regulations
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 4(1)
- Reg. 3(a)
Parties
- Ashok Investors Trust Limited
Holding
The Noticee, Ashok Investors Trust Limited, was held to have violated Regulation 3(a), 4(1) and 4(2)(a) of the PFUTP Regulations by executing non-genuine reversal trades in illiquid stock options at BSE, and a penalty of Rs. 8,00,000 was imposed under Section 15HA of the SEBI Act.
Full text
Page 1 of 17 BEFORE THE ADJUDICATING OFFICER SECURITIES AND EXCHANGE BOARD OF INDIA (ADJUDICATION ORDER NO: AO/SBM/EAD-1/11/2019) UNDER SECTION 15-I OF THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 READ WITH RULE 5 OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (PROCEDURE FOR HOLDING INQUIRY AND IMPOSING PENALTIES BY ADJUDICATING OFFICER) RULES, 1995. In respect of: Ashok Investors Trust Limited PAN: AACCA5450B A - 2 Wing, 201, Kailash Complex, LBS Marg, Bhandup West, Mumbai-400078
Page 2 of 17 2. It was observed during the course of investigation that a total of 2,91,643 trades comprising 81.38% of all the trades executed in the Stock Options Segment at BSE during the investigation period were trades which involved reversal of buy and sell positions by the clients and counterparties in a contract on the same day. It was also observed that the aforesaid trades resulted into creation of artificial volume to the tune of 826.21 crore units or 54.68% of the total market volume in Stock Options segment of BSE during the investigation period. In view of the large scale reversal of trades that were observed in the illiquid Stock Options segment at BSE, it is alleged that these trades were non-genuine and manipulative in nature.
Page 3 of 17 Act read with Rule 3 of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 (hereinafter referred to as ‘Adjudication Rules’) to inquire into and adjudge under the provisions of section 15HA of the SEBI Act for the aforementioned alleged violation of the provisions of law by the Noticee. SHOW CAUSE NOTICE, HEARING AND REPLY
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Source: SecMarx — sebi:AO/SBM/EAD-1/11/2019. 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.