sebi:MO/36/MIRSD/08/2006

SEBI · SEBI · 2003-08-25 · Dr. T.C. Nair, Whole Time Member

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Facts / Headnote

Suspension of certificate of registration for a period of 5 years

Provisions invoked

Regulations

Parties

Holding

In exercise of powers under Section 19 of SEBI Act, 1992 read with Regulation 13(4) of the Enquiry Regulations, the certificate of registration of Vivenasri Financial Services Ltd. (INB061156031) was suspended for 5 years from September 15, 2003, equivalent to the prohibition imposed vide directions dated August 25, 2003.

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. 1.1  Vivenasri Financial Services Ltd. (hereinafter referred to as the ‘broker’) is a member of Hyderabad Stock Exchange, (hereinafter referred to as ‘HSE’), and is registered Securities and Exchange Board of India (hereinafter referred to as ‘SEBI’) as a Stock broker under Section 12 of SEBI Act, 1992 with Registration Number INB061156031. 1.2  SEBI conducted investigation into the affairs related to buying, selling and dealings in the shares of Zodiac Clothing Company Limited and found that the broker alongwith tw entities viz. Newfin Financial Services Pvt. Ltd. and Harsh Pranav Securities Pvt. Ltd. indulged in structured deals, cross deals and circular trading. 1.3 In view of the above, SEBI initiated proceedings under Section 11(4) and 11B of Securities and Exchange Board of India Act, 1992 read with Regulation 11 of Securities and Ex Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 1995. 1.4 During the course of personal hearing before the Chairman, SEBI, the broker admitted to having indulged in cross and structured deals and also circular trading in the scrip of and that the said manipulations were committed as the broker required liquid cash for its business. 1.5 In view of the above, SEBI issued d

(1)  Notwithstanding amendment of the regulations as specified in regulation 21, anything done or any action taken including any proceeding for inspection or investig commenced or any notice issued under the said regulations before the commencement of these regulations shall be deemed to have been done or taken under th provisions of these regulations. (2)               In particular and without prejudice to the generality of the provisions of sub-regulation (1) – (i)                 an enquiry proceeding initiated by the Board under the relevant Regulations and pending before the Board before the commencement of these regulations completed under the relevant Regulations as if those are not amended as specified in regulation 21; (ii)               any order appointing an enquiry officer under the relevant Regulations and pending before such enquiry officer immediately before the commencement of t deemed to have been ordered under the corresponding provisions of these regulations.

in the scrip of Zodiac and that the said manipulations were committed as the broker required liquid cash for its business. 1.5 In view of the above, SEBI issued directions dated August 25, 2003 prohibiting the broker from buying, selling and dealing in securities, in any manner, directly or indirectly, for a period of five years, for the reasons stated therein. 1.6 An Enquiry Officer was appointed vide Order dated November14, 2003 under Regulation 5(1) of SEBI (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (hereinafter referred as the ‘said regulations’) to enquire into the possible violations of Regulation 25 of SEBI(Stock Brokers an Sub-brokers) Regulations, 1992 by the broker. 1.7 A Notice dated March 31, 2004 was issued to the broker under Regulation 6 (1) of the said regulations. The broker, however, neither replied to the aforesaid show cause notice nor requested to be heard in person. Hence the EO proceeded with the enquiry exparte based on the material available and submitted his report dated July 23, 2004 recommending a major penalty of suspension of certificate of registration of the broker for a period of 5 years. 1.8 A copy of the Enquiry Report was sent to the broker along with a show cause notice dated July 29, 2004, in terms of Regulation 13(2) of the said Regulations calling upon it to show cause as to why appropriate penalty including the penalty as recommended by the Enquiry Officer should not be imposed on it. The

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Source: SecMarx — sebi:MO/36/MIRSD/08/2006. 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.