sebi:BM/AO-110/2010
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Facts / Headnote
Penalty imposed on the Noticee for violation of PFUTP Regulations
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 4(1)
- Reg. 3(a)
Parties
- Karni Ajaysingh Jagdishsingh Rathore
Holding
The Noticee, Karni Ajaysingh Jagdishsingh Rathore, was held to have violated regulations 3(a), (b), (c), (d) and 4(1) of the PFUTP Regulations, 2003 by acting as a link in off-market transfers of Eltrol Ltd. shares that were subsequently offloaded in the market through synchronized trades, creating artificial volume. A penalty of Rs. 2,00,000 was imposed under section 15HA of the SEBI Act.
Full text
Page 2 of 18 lowest volume on July 01, 2005, when only one share was traded and highest being on August 26, 2005 when 1,36,70,180 shares were traded.
Page 3 of 18 3. It was observed from the investigation that one of the entities, Karni Ajaysingh Jagdishsingh Rathore, (hereinafter referred to as “Noticee”) was transferred shares in the offmarket by entities allegedly connected to EL or the directors of EL. These shares were offloaded in the market which allegedly created volume in the market. In view of the above it was alleged that the Noticee violated regulations 3(a), (b), (c), (d) and 4 (1) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Markets) Regulations, 2003 (hereinafter referred to as “PFUTP”) and consequently, liable for monetary penalty under section 15HA of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as “SEBI Act”).
Page 4 of 18 under rule 4(1) of the Rules to show cause as to why an inquiry should not be held and penalty be not imposed under section 15HA of SEBI Act for the alleged violation specified in the said SCN.
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Source: SecMarx — sebi:BM/AO-110/2010. 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.