sebi:EAD/PM-AA/AO/4/2018-19

SEBI · SEBI · 2017-12-14 · Prasanta Mahapatra, Adjudicating Officer

Reviewed by Varun Matlani, Advocate — Securities Lawyer practicing in SAT and SEBI

Facts / Headnote

Disposed of without imposition of any penalty

Provisions invoked

• s. 15I
• s. 15G

Regulations relied on

• SEBI (PIT) Regulations, 1992 — 3(i)
• SEBI (PIT) Regulations, 2015 — 12(2)

Parties

• Shri Parag Kishorekumar Ajmera

Holding

The alleged violation of Regulation 3(i) of the PIT Regulations, 1992 by sale of 300 shares of MCX on November 30, 2012 was not established because no UPSI was in existence on that date, and SCN No. EAD/AO-PM/AA/OW/31610/2017 dated December 14, 2017 was disposed of without imposition of any penalty.

Full text

Adjudication Order in respect of Parag K Ajmera in the matter of MCX Page 2 of 8 days and impending payment defaults by the members of NSEL and loss of reputation of Promoters and Management of MCX. It was observed that any news impacting business of NSEL will automatically impact share price of its holding company (i.e. FTIL) and associate companies (i.e. MCX) and any news impacting credentials of Promoters and Management of FTIL, NSEL and MCX will also impact the share price of MCX, therefore suspension of trading by NSEL was a negative news. As per the Investigating Authority, the UPSI came into existence on April 27, 2012, upon the issuance of the SCN to NSEL by the DCA and it ceased to exist when NSEL suspended trading in all contracts (except e-series contracts) and deferred settlement of all pending contracts on July 31, 2013.

Adjudication Order in respect of Parag K Ajmera in the matter of MCX Page 3 of 8 Regulation 12(2) of SEBI (Prohibition of Insider Trading) Regulations, 2015 (hereinafter referred to as “PIT Regulations, 2015”). APPOINTMENT OF ADJUDICATING OFFICER

Adjudication Order in respect of Parag K Ajmera in the matter of MCX Page 4 of 8 matter of record that t he said proceedings have been concluded by the WTM's order on January 5, 2018.  The WTM has arrived at a conclusion that i) the UPSI arose as a result of a Show Cause Notice ("SCN") dated April 27, 2012 that was issued by the department of Consumer Affairs to NSEL and ii) th e UPS I pe riod ceased to exist on October 03, 2012 when the information and implication of the said SCN was published in the Economic Times.  It is pertinent to note that upon perusal of the subject SCN, it is SEBI’s own case that our client had sold only 300 shares of MCX on November 30, 2012 and therefore in view of the findings recorded by the WTM, the said trades by our client cannot be said to be based on or during UPSI. Since the allegations in the said WTM's proceedings are identical to the allegations in the subject proceedings against our client, the subject proceedings deserve to be dropped and may not be proceeded. In view of the said findings, it is also clear that the trades entered into by our client are not in violation of Regulation 3(i) of PIT Regulations, 1992 or any provisions of law.  You have recently exonerated other noticees without imposing any

Source: SecMarx — sebi:EAD/PM-AA/AO/4/2018-19. 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.