sebi:EAD-3/JS/GSS/01-02/2019-20

SEBI · SEBI · 2018-07-10 · Jeevan Sonparote, Adjudicating Officer

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Facts / Headnote

Penalty imposed on both noticees

Provisions invoked

Regulations

Parties

Holding

Noticee 1 Rushabh Jitendra Shah violated Regulation 13(4), 13(4A) read with 13(5) and Model Code under Regulation 12(1) of PIT Regulations and Regulation 29(2) read with 29(3) of SAST Regulations, and Noticee 2 Minesh Shah violated Regulation 13(1), 13(3) read with 13(5) of PIT Regulations and Regulation 29(1) and 29(2) read with 29(3) of SAST Regulations. Penalty of Rs.20,00,000 plus Rs.5,00,000 on Noticee 1 and Rs.5,00,000 on Noticee 2 was imposed.

Full text

Adjudication Order No. EAD-3/JS/GSS/01-02 /2019-20 Adjudication order in the matter of Aadi industries Page 2 of 14 personal hearing on July 18, 2018. The Noticee No. 1 vide his letter dated July 10, 2018, submitted his reply to the aforesaid SCN, wherein the Noticee admitted said defaults with respect to disclosures under PIT and SAST regulations.

Adjudication Order No. EAD-3/JS/GSS/01-02 /2019-20 Adjudication order in the matter of Aadi industries Page 3 of 14 12. Subsequently, vide e-mail dated January 22, 2019 and March 18, 2019, it was informed by operational department that “we are in receipt of settlement application in the present matter and the same was returned to the applicant”. Details of the settlement application filed by the Noticee in the present matter are as below; Name of the Noticee Date of receipt of settlement application Status of the application Rushabh Jitendra Shah January 11, 2019 Returned vide vide letter no. SEBI/HO/EFD- 2/CSD/OW/P/2019/2106/1 dated January 21, 2019 on ground of not accompanied with application fees as specified under Regulation 3(2) of the Settlement Regulations Rushabh Jitendra Shah January 28, 2019 Returned vide vide letter no. SEBI/HO/EFD- 2/CSD/OW/P/2019/3084/1 dated January 31, 2019 on ground of not accompanied with application fees. The applicant was advised to submit the revised application in terms of SEBI (Settlement Proceedings) Regulations, 2018, within fifteen days from the date of letter along with application for condonation of delay and copy of SCN dated June 04, 2018.

Adjudication Order No. EAD-3/JS/GSS/01-02 /2019-20 Adjudication order in the matter of Aadi industries Page 4 of 14 16. Therefore, it is observed that the Noticees despite of giving several reminders and opportunities, neither filed the settlement application within the stipulated time and manner nor submitted any substantial reply in the matter regardless of having clear knowledge and information, in this regard. It is further noted that the Noticees claimed to file settlement application under SEBI (Settlement proceedings) Regulations, 2018. Here, attention may be drawn towards regulation 4 of SEBI (Settlement proceedings) Regulations, 2018, (came into force on January 01, 2019) which says that; 4(1) “An application in respect of any specified proceeding pending before the Board shall not be considered if it is made after sixty days from the date of service of the notice to show cause or supplementary notice(s) to show cause, whichever is later. (2) Notwithstanding anything contained in sub-regulation (1), the Board may consider the application, if satisfied that there was sufficient cause for not filing it within the specified period and it is accompanied with non- refundable fees as specified in Part-B of the Schedule-I: Provided that, where the application is filed after sixty calendar days from the expiry of the period specified in sub-regulation (1), the settlement amount determined in accordance with Schedule-II of these regulations shall be increased by twenty five p

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Source: SecMarx — sebi:EAD-3/JS/GSS/01-02/2019-20. 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.