sebi:BM/AO-140/2011
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Penalty of Rs 2,50,000 imposed under Section 15HA
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 4
- Reg. 3
- Reg. 4(1)
Parties
- Manish Pancholi
Holding
The Noticee violated regulations 4(1) and 4(2)(a) of the PFUTP by aiding and abetting the promoters in synchronized trading creating misleading appearance of trading, while violations of regulations 4(2)(b), (e) and (g) were not established. A penalty of Rs 2,50,000 under Section 15HA of the SEBI Act was imposed on the Noticee.
Full text
Page 2 of 20 viz: Aditya Jain, Divya Jain, Shakuntala Jain, Kumud Jain, Rajkumar Jain, Vivek Jain, Shivani Jain and Advik Finance and Properties Private Limited transferred shares to the connected/related entities and started trading actively among themselves and entered into synchronized transactions in the market. This created artificial volume and generated more demand in the scrip and as a result, the share price increased and subsequently the promoters offloaded their own shares.
Page 3 of 20 Noticee and penalty be not imposed on the Noticee under section 15HA of SEBI Act for the alleged violation specified in the said SCN.
Page 4 of 20 The Noticee submits that the SCN erroneously considers that the Noticee whilst dealing in the scrip of ALL in his own account and in his capacity as an investor / trader, has acted in concert with the brokers, other promoters of ALL and entities related to and / or connected with the promoters of ALL to create artificial volume in the scrip of ALL which lead to manipulation in the price of the scrip of ALL during the Investigation Period. The Noticee submits that the matching of his trades was in the ordinary course of stock market dealing as per time price priority and cannot be considered as synchronized with a view to artificially inflate the volume and / price of ALL scrip. The Noticee states that he did not know end clients or their respective brokers, whilst dealing in the scrip of ALL. It is alleged against the Noticee in the SCN that he placed orders on behalf of all the promoters /their associates. At the outset the allegations are denied in toto. Firstly, the Noticee did not know all the promoters of ALL and neither all the promoters of ALL were introduced by him as constituents to Ajmera. It was only much later, i.e. after the commencement of the erstwhile adjudication proceedings that the Noticee learnt that one of the constituents introduced from the Jain family, viz. Mr. Vivek Jain is a promoter of ALL. Assuming without admitting that the Noticee placed order for and on behalf of the promoters / their associates the same are not considered as sy
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Source: SecMarx — sebi:BM/AO-140/2011. 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.