sebi:BM/AO-131/2010

SEBI · SEBI · 2004-08-16 · Barnali Mukherjee, Adjudicating Officer

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Penalty imposed; violations of sections 11C(2) and 11C(3) of the SEBI Act established; allegation of violation of section 11C(5) not sustained

Provisions invoked

• s. 11
• s. 15A
• s. 15
• s. 15J
• s. 11C
• s. 12

Regulations

• Reg. 18

Parties

• Echolac Finvest Pvt Ltd

Holding

The Noticee was held liable for violating sections 11C(2) and 11C(3) of the SEBI Act by failing to fully comply with summonses issued by the Investigating Authority, and a penalty of Rs. 1,50,000 was imposed under section 15A(a). The allegation of violation of section 11C(5) was not sustained as the summonses only required production of documents and not personal appearance.

Full text

2 observed that these brokers and clients were either not furnishing the desired information or giving incomplete or even incorrect information. Summons was therefore issued by the Investigating Authority of SEBI (hereinafter referred to as “IA”) to certain entities seeking information relating to their trading in the scrip of GHCL.

3 7. The Noticee vide letter dated August 04, replied to the SCN stating interalia the following: ¾ On August 30, 1999 we received a letter from RK Kakkar dated 24 Aug 1999 and reminder dated 29 Sept 1999. We have submitted our reply on 27 Oct 1999. ¾ After a gap of three years we again received a letter dated Dec 27, 2002 from SEBI asking for the same information which we provided in the year 1999. We replied to your above letter dated Jan 13, 2003 that information sought had already been provided in Oct 1999. ¾ In Oct 2003 we received summons dated 30 Sept 2003 stating to refurnish the information asked for in letter dated 27 Dec 2002, as our letter send in Oct 1999 did not contain any annexure (as claimed by SEBI). We then received a letter from Mr. Sanjeev Dutt dated 07 Oct 2003 which substitute the summons issued on September 30, 2003 and asked us to provide information. We have provided all information as asked for with our letters dated Nov 11, 2003. ¾ In Aug 2004, we again received summons dated 16.08.2004, asking for the same details which we provided in Nov 2003. In Dec 2004 we again received a letter from SEBI dated 29 Dec 2004 further asking for distinctive number of shares delivered during the period Nov 1996 – Nov 1997. To which we have regretted our inability to provide the list. No of shares delivered during the period Nov 1996 to Nov 1997 as company had discontinued the operation in Nov 1997 and so the required data was not available with us. ¾ It was contend

4 (hereinafter referred to as the AR) of the Noticee appeared for the hearing and submitted that their reply dated August 04, 2010 can be taken as the final submission to the SCN.

Source: SecMarx — sebi:BM/AO-131/2010. 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.