sebi:MO/26/IVD/07/04

SEBI · SEBI · A.K. Batra, 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

Order passed against Shri V.K. Jatia and his family members for fraudulent and unfair trade practices in the public issue of Infoquest Software Exports Ltd.

Provisions invoked

Regulations

Parties

Holding

Shri Jatia and his family members were found to have financed the public issue of ISEL by applying for large quantities of shares through fraudulently obtained predated stock invests, creating a false impression of oversubscription, in violation of Regulation 3 of the SEBI (PFUTP) Regulations, 1995.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER UNDER REGULATION 11 OF SEBI (PROHIBITION OF FRAUDULENT AND UNFAIR TRADE PRACTICES RELATING TO SECURITIES MARKETS) REGULATIONS, 2003 AND SECTION 11 AND 11B OF THE SEBI ACT, 1992. AGAINST SHRI V.K. JATIA AND HIS FAMILY MEMBERS, SHRI SHUBHKARAN JATIA, SMT. SHASHI JATIA, SMT. RAMPYARI DEVI JATIA, SMT. SMITA JATIA, SMT. ARCHNA JATIA & SMT. NITA JATIA, IN THE MATTER OF INFOQUEST SOFTWARE EXPORTS LTD.

Sr No  Address  No. of Applicants  Total no. of Shares Applied for  1 C/o Khadwala, 8/B Parisima Complex, C.G. Road, Navrangpura, Ahmedabad 7 72,00,000 2 C/o Rajesh N. Jhaveri, Jhaveri Building, Opp. Bank of India, Manek Chowk, Ahmedabad 17 45,00,000 3 C/o 5 B, Mitra Mandal Society, Opp. Darpan Usmanpura, Ahmedabad 11 21,40,000 4 C/o Suresh Kumar, 7 Sunrise Park, Row House, Opp. Drive In Cinema, Thaltej, Ahmedabad 10 37,00,000 5 C/o B/42, Mehta House, Off Link Road, Andheri (W), Bombay 400 053 9 29,00,000 6 C/o 91, M.Karve Road, 1 Pearl Mansion (N), Bombay 400 020 13 40,00,000 7 C/o Secretarial Dept. Empire House, S.B. Marg, Lower Parel, Bombay 400 009 11 22,00,000 8 C/o 260, Sant Tukaram Road, Carnac Bunder, Bombay 400 009. 2 12,00,000 TOTAL  80  2,78,40,000

11.1 One Shri Devendra Kantilal Shah alias Munna of/acting on behalf of one M/s Arihant Finance Corporation, was involved in the business of financing public issues and in case of shortfall of funds, funds were borrowed from the market. He has confirmed that he was involved in the financing of the public issue of ISEL and that he was the negotiator between the financiers and the directors of ISEL. In his statement he has submitted that that the practice in cases of such kind was that an agreement is entered into with clients who approach for financing of the issue;the interest rate is agreed upon right at the beginning and the shares allotted are subject to buy-back, though the interest is received on full amount of application and the interest income is subject to income tax.

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Source: SecMarx — sebi:MO/26/IVD/07/04. 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.