sebi:ISD/FDIL/AO/DRK/AKS/EAD-3/288/54-11
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Facts / Headnote
Violation of Regulation 13(1) and Regulation 13(3) read with Regulation 13(5) of PIT Regulations found; penalty of Rs. 2,00,000 imposed under Section 15A(b) of SEBI Act.
Provisions invoked
- s. 15A
- s. 15
- s. 12
- s. 15J
Regulations
- Reg. 7
- Reg. 7(1)
- Reg. 13
- Reg. 13(1)
- Reg. 13(3)
- Reg. 8
- Reg. 13(5)
- Reg. 7(2)
- Reg. 58
- Reg. 8(a)
Parties
- Shri Abhishek Jain
Holding
The noticee violated Regulation 13(3) read with Regulation 13(5) and Regulation 13(1) of the PIT Regulations by failing to disclose the off-market transfer of 10,00,000 shares of FDIL on 31.10.2009 and the re-acquisition on 23.12.2009, and a penalty of Rs. 2,00,000 under Section 15A(b) of the SEBI Act was imposed.
Full text
Page 2 of 11 2. Based on the alert, information was collected from Bombay Stock Exchange Ltd. (hereinafter referred to as ‘BSE’), NSDL and CDSL and clarification was sought from the company and RGPL.
Page 3 of 11 a. From the investigation report it is observed that noticee had offloaded 10,00,000 shares (6% of the paid up share capital of the company) to RGPL on 31.10.2009 in off-market. After the transfer of the shares, noticee’s holding in FDIL had become zero. It is alleged that no disclosure has been made by the noticee for such transfer as required under PIT Regulations to the company which has led to the violation of Regulation 13 (3) read with Regulation 13 (5) of PIT Regulations. b. It was further observed that the transferred shares of FDIL have been transferred back to the noticee on 23.12.2009 by RGPL. It is alleged that the noticee had not disclosed his acquisition of shares of FDIL to the company and to the stock exchange as required under Regulations 7 (1) read with 7 (2) of Takeover Regulations. c. Further, it is observed that under Regulation 13 (1) of PIT Regulations, noticee was required to disclose to the company within 2 working days of the receipt of intimation of allotment of shares or the acquisition of shares, as the case may be. However, it is alleged that no disclosure for such acquisition of shares has been made by the noticee to the company as required under PIT Regulations.
Page 4 of 11 Regulation 7 (1A) of Takeover Regulations as they are part of Promoter and Promoter Group. The AR submitted that the noticee being pledger is required to make disclosures under Regulations 8 A (1), 8 A (2) and 8 A (3) of Takeover Regulations to the company and to the stock exchange. The AR further submitted that PIT Regulations is not applicable to the noticee since the shares were pledged. The AR undertook to submit a detailed reply to the show cause notice within a week. Accordingly the noticee vide his letter dated 29.08.2011 submitted a reply to the SCN wherein he stated as follows-
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Source: SecMarx — sebi:ISD/FDIL/AO/DRK/AKS/EAD-3/288/54-11. 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.