sebi:BM/AO-149/2011

SEBI · SEBI · 2003-12-12 · Barnali Mukherjee, Adjudicating Officer

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Facts / Headnote

Proceedings disposed of; allegation not established, no penalty imposed

Provisions invoked

• s. 11(4)
• s. 15
• s. 15H
• s. 15J

Holding

The Adjudicating Officer found that the allegation that the Noticee violated SEBI's debarment directions by transferring shares during the debarment period was not established, and declined to impose any penalty under section 15HB of the SEBI Act.

Full text

Page 2 of 8 (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 debarring the Noticee from dealing in the securities market for a period of 14 years.

Page 3 of 8 6. Vide letter dated November 22, 2010, the Noticee sought extension to file reply. Vide letter dated January 5, 2011 the Noticee replied to the SCN stating, inter alia, the following: ¾ In so far as our shareholding is concerned, we are seriously concerned of the allegation and state that we are holding 3,49,400 shares of Rs.10/- each of BEPL and not 34,81,000 shares as stated in the chart. Assuming that BEPL has split its shares to Re.1/- per share paid up, it would be right to conclude that we are holding 34,94,000 share of Re.1/- per share paid up and not 34,81,000 shares. Save and except that, the shareholding pattern shown for the quarter ended 31.12.2004 and 31.3.2005 in the chart as “Not available” should be the same as depicted for the quarter ended 30.9.2004 i.e. 34,94,000 shares of Re.1/- per share paid up, as explained above, as we have not dealt in the shares as alleged. ¾ It is denied that we have dealt in securities market by selling the entire shareholding i.e. 34,81,000 shares or that matter of fact any shares to Mahesh Kokate or to any one else on November 25, 2005 or on any date during the subsistence of the debarment order dated 12.12.2003, as alleged. We state that we are not aware about transfer of 34,81,000 shares to Mahesh Kokate on November 25, 2005 but are seriously concerned about the same. In any event the SCN has failed to annexe a copy of the data alleged to have been provided by Sharex, the STA and relied upon by you. We seek inspect

Page 4 of 8 ¾ In continuation of our reply dated 05.01.2011, we state that SEBI has yet to address our concern that we are holding 3,49,400 shares of Rs.10/- each of BEPL and not 34,81,000 shares as stated. Assuming that BEPL has split its shares to Re. 1/- per share paid up, SEBI may be pleased to issue a clarification that we are holding 34,94,000 shares of Re.1/- per share paid up and not 34,81,000 shares. It is submitted that to that extent the SCN is faulty and needs to be withdrawn forthwith. ¾ The SCN alleges that we have dealt in securities market by selling/transferring our entire shareholding i.e. 34,81,000 shares to one Mahesh Kokate on 25.11.2005 during the subsistence of the debarment order. We state that we are in possession of and beneficial owners of 3,49,400 shares of BEPL in physical form. We reserve our right to produce share certificates if necessary when called for. ¾ Since SEBI is only relying on the letter dated 09.12.2009 of STA Sharex Dynamics India Pvt. Ltd. together with Annexure 6 being transactions in physical form and one page of transaction report in physical segment (10,000 and above), we seek documentary evidence showing that, on subdivision of shares of BEPL from Rs.10/- paid up to Re.1/- paid up on 02.12.2003 and for which the record date was 10.12.2003, STA Shrex Dynamics India Pvt. Ltd. had in fact dispatched the sub divided certificates to us as shareholders as well as the certificate numbers and distinctive numbers of the shares in quest

Source: SecMarx — sebi:BM/AO-149/2011. 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.