sebi:EAD/BJD/NJMR/184/2017-18

SEBI · SEBI · 2001-02-07 · B J Dilip, Adjudicating Officer

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Facts / Headnote

Proceedings continued; Noticee found to have executed impugned trades in capacity of client, not sub-broker; allegations of synchronized/circular trades under consideration

Provisions invoked

• s. 11B
• s. 11
• s. 15
• s. 12A
• s. 12
• s. 15H
• s. 15J
• s. 15A
• s. 15F

Regulations

• Reg. 4
• Reg. 3
• Reg. 4(a)
• Reg. 2
• Reg. 3(a)

Parties

• Sunita Gupta

Holding

The Adjudicating Officer held that the Noticee's trades in Gangotri Textiles were executed in the individual capacity as a client and not as a sub-broker, and was proceeding to consider allegations of synchronized and circular trades under SEBI Act and PFUTP Regulations.

Full text

Adjudication Order in respect of Sunita Gupta in the matter of Gangotri Textiles Ltd., Page 2 of 46 contention of the Appellant the Adjudicating Officer held that the trades were executed in the individual capacity as a client and not as a sub-broker.

Adjudication Order in respect of Sunita Gupta in the matter of Gangotri Textiles Ltd., Page 3 of 46 clarify whether all the transactions with regard to her dealings in the scrip of Gangorti during the period of investigation as alleged in the SCN, were carried out in the capacity of sub-broker or individual. Further, the Noticee was advised to submit corresponding documents relating to her registration as sub-broker along with copy of the Know Your Client (KYC) documents in support of her submissions. The SCN dated December 12, 2013 was issued to the Noticee to show cause as to why an inquiry should not be held against her and penalty, if any, should not be imposed on her under the provisions of Section15HA of SEBI Act for the alleged violation of the provisions of SEBI Act and SEBI (PFUTP) Regulations.

Adjudication Order in respect of Sunita Gupta in the matter of Gangotri Textiles Ltd., Page 4 of 46 (a) That the current proceedings be withdrawn without imposing penalty in view of time taken to decide in the matter, pursuant to Hon’ble SAT’s Order dated April 29, 2016. (b) Hon’ble Whole Time Member, SEBI had passed an Order dated April 13, 2016 by restraining the Noticee from accessing the securities market for three years, which was upheld by Hon’ble SAT vide Order dated April 21, 2017. (c) Therefore, initiation of parallel proceedings for the same said cause of action of the same alleged breach, which is subject matter of present notice, cannot be continued. If the current proceedings continued, it would amount to double jeopardy, as the same is specifically prohibited under Order 2 Rule 2 of Civil Procedure Code, 1908. It is well settled by the Hon’ble Supreme Court that the violation of Rules under SEBI Act is a mere civil breach, therefore, if a person who commits a criminal offence which is more heinous and grave, he cannot be tried twice for the same offence. (d) As the Noticee has already been restrained from securities market, there is no income for livelihood. (e) The Noticee is the registered Sub-broker with Delhi Stock Exchange having registration no., INS050923510 from February 7, 2001. The Noticee being a sub- broker has dealt in the listed securities of Gangotri along with others shares for their clients namely Perfect Car Scanners Ltd., and their associates

Source: SecMarx — sebi:EAD/BJD/NJMR/184/2017-18. 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.