sebi:MO/127/IVD/01/06

SEBI · SEBI · 2003-03-14 · Madhukar, Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Warning issued

Provisions invoked

• s. 19
• s. 12
• s. 13

Regulations

• Reg. 13
• Reg. 15
• Reg. 5

Parties

• M/s. Subecha Securities Private Limited

Holding

M/s. Subecha Securities Private Limited was found guilty of violating the Code of Conduct and Section 12(3) of the SEBI Act, 1992, and was warned to be careful in the future and desist from transactions of the nature carried out in the scrip of Soundcraft Industries Limited.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER AGAINST M/S. SUBECHA SECURITIES PRIVATE LIMITED, A SUB-BROKER OF M/S. SVS SECURITIES PRIVATE LIMITED, WITH SEBI REGITRATION NO. INS 010480536, UNDER SECTION 13 (4) OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (PROCEEDURE FOR HOLDING ENQUIRY BY AN ENQUIRY OFFICER AND RECOMMENDATION OF PENALTY) REGULATIONS, 2002, IN THE MATTER OF M/S. SOUNDCRAFT INDUSTRIES LIMITED. Whereas, an investigation was conducted into the dealings in the scrip of M/s. Soundcraft Industries Ltd. (hereinafter referred to as SIL) after a sudden price rise was observed in the scrip in both The Stock Exchange, Mumbai (hereinafter referred to as BSE) and The National Stock Exchange (hereinafter referred to as NSE) during the period December 1998 to July 1999, and, Whereas, during the investigation it was found that M/s. Subecha Securities Pvt. Ltd., (hereinafter referred to as ‘the sub-broker’) a sub-broker of M/s. SVS Securities Pvt. Ltd., a member of BSE (one among the top 5 brokers who have dealt in the scrip of SIL at BSE and hereinafter referred to as SVSSPL), had transacted in the scrip of SIL on behalf of its clients Shri Yogesh Panchal and Shri Nagraj Kundar, and, Whereas, an enquiry officer was appointed by SEBI vide order dated 14.03.03 under Regulation 5 (1) of SEBI (Proceedure for holding enquiry by an Enquiry Officer and recommendation of penalty) Regulations, 2002 for inquiring into the possible violation of

DATE:25-01-06 WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA 30/10/2025, 12:43 about:blank about:blank 2/2

received within 15 days or else it would be presumed that the sub-broker had no explanation to offer and SEBI would be free to take such action in the matter as it deems fit, and, Whereas, the show cause notice was delivered to the sub-broker on 04.10.04 and no reply has been received from the sub-broker, to the show cause notice dated 01.10.04, and, Whereas, the issues for consideration is whether, the sub-broker is guilty of violating the provisions of Clause A (2) of the Code of Conduct for sub-brokers prescribed in Schedule II read with Regulation 15 of SEBI (Stock Broker and Sub-broker) Regulations, 1992 and Section 12 (3) of the SEBI Act, 1992. I have considered the enquiry report and the findings therein. I am convinced that sufficient opportunity has been given to the sub-broker to furnish its reply to the findings in the enquiry report and that the principles of natural justice is adequately satisfied. I find that the sub-broker had dealt in the scrip of SIL through M/s. Betala Stock Broking Pvt. Ltd. Member, NSE (hereinafter referred to as BSBPL) for the client Shri Nagaraj Kundar. The sub-broker has dealt with Shri Kundar at the NSE, even when its application for acting as a sub-broker to BSBPL was pending with the NSE due to certain technical reasons. Shri Kundar was acting as a front entity to M/s. Rajkumar C. Basantani, the promoter of SIL, a member of NSE and the primary player behind the price manipulation in the scrip of SIL. The sub-broker has also traded in

Source: SecMarx — sebi:MO/127/IVD/01/06. 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.