sebi:MO/31/MIRSD/12/2005

SEBI · SEBI · 2004-11-03 · 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

Provisions invoked

• s. 19
• s. 12

Regulations

• Reg. 7
• Reg. 13(4)
• Reg. 13(2)
• Reg. 5

Parties

• Sykes & Ray Equities (I) Ltd.

Holding

The Whole Time Member warned Sykes & Ray Equities (I) Ltd., member of NSE, and directed it to be more cautious in future and adhere to the SEBI Act, 1992 and Rules and Regulations thereunder.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ ORDER UNDER REGULATION 13(4) OF SEBI (PROCEDURE FOR HOLDING ENQUIRY BY ENQUIRY OFFICER AND IMPOSING PENALTY) REGULATIONS, 2002, AGAINST SYKES & RAY EQUITIES (I) LTD., MEMBER, THE NATIONAL STOCK EXCHANGE, SEBI REGISTRATION NO. INB230727738 1.0  BACKGROUND 1.1             Sykes & Rays Equities (I) Ltd. (hereinafter referred to as “the broker”) is a member of the National Stock Exchange (“NSE”) registered with SEBI as a stock broker under se of SEBI Act, 1992 with SEBI Registration No. INB230727738. 1.2             An inspection of the books of accounts, documents and other records maintained by Sykes & Rays Equities (I) Ltd. for the period April 01, 2000 to August 31, 2002 was car by M. M. Nissim and Co., Chartered Accountants appointed by SEBI in terms of letter dated SMD/DBA-1/Pre-Insp./AK/14877/2002 dated August 6, 2002. Certain irregu contraventions of SEBI Regulations were observed during the said inspection. 2.0 ENQUIRY PROCEEDINGS 2.1             In view of the above, an Enquiry Officer (EO) was appointed vide SEBI Order dated March 08, 2004 under Regulation 5 of SEBI (Procedure for holding enquiry by Enquiry and Imposing Penalty) Regulations, 2002 (hereinafter referred to as ‘said regulations’) to enquire into the alleged contraventions observed during the inspection of b accounts of the broker. The EO after conducting the enquiry in terms of the said regulations submitted his report on 28

1.1 Sykes & Rays Equities (I) Ltd. (hereinafter referred to as “the broker”) is a member of the National Stock Exchange (“NSE”) registered with SEBI as a stock broker under section 12 of SEBI Act, 1992 with SEBI Registration No. INB230727738. 1.2 An inspection of the books of accounts, documents and other records maintained by Sykes & Rays Equities (I) Ltd. for the period April 01, 2000 to August 31, 2002 was carried out by M. M. Nissim and Co., Chartered Accountants appointed by SEBI in terms of letter dated SMD/DBA-1/Pre-Insp./AK/14877/2002 dated August 6, 2002. Certain irregularities / contraventions of SEBI Regulations were observed during the said inspection. 2.0 ENQUIRY PROCEEDINGS 2.1 In view of the above, an Enquiry Officer (EO) was appointed vide SEBI Order dated March 08, 2004 under Regulation 5 of SEBI (Procedure for holding enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (hereinafter referred to as ‘said regulations’) to enquire into the alleged contraventions observed during the inspection of books of accounts of the broker. The EO after conducting the enquiry in terms of the said regulations submitted his report on 28.10.04 and recommended a minor penalty of warning against the broker. 3.0 SHOW CAUSE NOTICE AND THE BROKER’S SUBMISSIONS 3.1 A copy of the Enquiry Report was sent to the broker along with a show cause notice dated 03.11.04, in terms of regulation 13(2) of the said Regulations advising it to show cause as to why the penalty as reco

were mere technical or procedural. There has been no allegation in the Enquiry Report or in the Notice of any malafides on their part. All the alleged violations were found to be technical or procedural by the Enquiry Officer which were caused inadvertently in the course of conduct of business. On coming to their knowledge, they have immediately taken ameliorative actions to rectify such errors. The broker further submitted that all the findings in the Inspection Report and the Enquiry Report in fact confirm that they have been substantially compliant of all the applicable regulations, bye laws and directives of SEBI and National Stock Exchange of India, except in very exceptional and technical matters. There are no existing irregularities or breaches of any applicable provisions and they are in compliance with the applicable Regulations. They in all sincerity are committed to be in compliance with the applicable rules and regulations. The broker further submitted that there was no gain or unfair advantage obtained by them. There was no loss caused to an investor or group of investors. There has been no instance of any alleged violations of the Regulations by them in the past. There has been no grievance from any of their clients. There are no arbitral proceedings pending against them. 4.0 CONSIDERATION OF ISSUES 4.1 I have carefully considered the facts and circumstances of the case. I have also

Source: SecMarx — sebi:MO/31/MIRSD/12/2005. 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.