sebi:HB/AO-06/2010
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Facts / Headnote
Charges established; monetary penalty of Rs. 1,00,000 imposed on the Noticee
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 4
- Reg. 3
- Reg. 3(a)
- Reg. 15H
Parties
- Nilesh Upadhyay
Holding
The Adjudicating Officer held that Nilesh Upadhyay violated Regulations 3(a), 4(1), 4(2)(a) and 4(2)(e) of the SEBI (PFUTP) Regulations, 2003 by acting as counter party buyer to the sell trades of the Agarwal Family and transferring shares to the broker's clearing member pool account, thereby aiding and abetting circular movement of shares and creation of artificial trading volumes, and imposed a monetary penalty of Rs. 1,00,000 under section 15HA of the SEBI Act.
Full text
Page 2 of 9 4:44 PM consider the pricing of the issue and also to consider the options and ways for expansion plans, acquisition and any other related matter for growth of the company and to consider the increase in authorized capital and issue of right/preferential shares. Rs.100.15 on March 1, 2005 to Rs.101.90 on next trading day. Volume increased from average daily trading volume of 3685 shares to average daily trading volume of 22606 shares for remaining investigation period. 2 11.03.2005 at 04:31PM The Board meeting which was scheduled to be held on March 08, 2005 has been postponed as the directors of the company have gone out of station. The price came down from closing price Rs.113.96 on March 11, 2005 to Rs.110.75 on next trading day. There was negligible effect on the volume.
Page 3 of 9 5. The investigation revealed that Shri. Nilesh Upadhyay (hereinafter referred to as “Noticee/NU”) had bought shares of EIL from the Agarwal Family during the investigation period. From the DP statement available it is observed that the NU had transferred shares of EIL to the broker RSSB’s Clearing Member (CM) pool account for delivery obligations of the Agarwal Family. In light of such trades it was alleged that NU had violated the provisions of the Regulations 3(a), 4(1), 4(2)(a) and 4(2)(e) of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’), and therefore, liable for monetary penalty under section 15HA of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as “SEBI Act”).
Page 4 of 9 8. The SCN could was returned undelivered. Thereafter the SCN was sent to SEBI’s Ahmedabad Regional Office (ARO) to be delivered at the residential address of NU. ARO vide letter dated February 5, 2010 informed that one Shri. B. H. Upadhyay, who introduced himself as the father of NU refused to accept the SCN addressed to NU and stated that he had no idea of NU’s whereabouts for the part four years. Further the pasting of the SCN was also denied.
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Source: SecMarx — sebi:HB/AO-06/2010. 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.