sebi:Order/AP/AS/2019-20/7258

SEBI · SEBI · Amit Pradhan, Adjudicating Officer

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

Facts / Headnote

Penalty imposed under section 15HA of the SEBI Act for market abuse and fraudulent practices through non-genuine trades in illiquid stock options at BSE

Provisions invoked

• s. 15H
• s. 15I
• s. 15J
• s. 15
• s. 15F
• s. 28A

Regulations

• Reg. 3
• Reg. 2(1)(c)
• Reg. 3(a)

Parties

• Amluckie Investment Company Limited

Holding

The Noticee was found to have executed 130 non-genuine trades across 33 stock option contracts at BSE, creating artificial volumes ranging from 0.31% to 100%, constituting market abuse and fraudulent practices warranting monetary penalty under section 15HA of the SEBI Act.

Full text

_________________________________________________________________________________ Adjudication order in respect of Amluckie Investment Company Limited in the matter of Illiquid Stock Options at BSE Page 2 of 18 of total 1,37,98,000 units. It is further observed that the Noticee, by executing non genuine trades during the relevant period, registered a negative close out difference of ₹3,02,70,000/- approx. The trades entered by the Noticee were reversed on the same day within a very short span of time with same counterparty at a substantial price difference without any basis for significant change in the contract price which indicates that these trades are artificial and are non-genuine in nature. The summary of dealings of Noticee in such 33 Stock Options contracts is as follows:

_________________________________________________________________________________ Adjudication order in respect of Amluckie Investment Company Limited in the matter of Illiquid Stock Options at BSE Page 3 of 18 26 RECL15MAR310.00PEW1 5.20 140000 0.20 140000 100% 100% 100% 100% 27 SAIL15FEB65.00PE 2.05 1004000 0.10 1004000 100% 43% 100% 58% 28 SAIL15MAR85.00CEW3 2.14 468000 0.05 468000 100% 20% 100% 58% 29 SAIL15MAR95.00CEW3 2.25 4000 0.05 4000 100% 13% 100% 0% 30 SUNT15FEB430.00PE 11.00 47000 1.00 47000 67% 5% 98% 12% 31 TATP15MAR70.00PEW1 2.40 180000 0.05 180000 100% 33% 100% 61% 32 TCOM15MAR410.00PEW1 9.49 127000 0.50 127000 100% 100% 100% 100% 33 WOCK15MAR1530.00PEW1 50.40 28500 2.00 28500 100% 100% 100% 100%

_________________________________________________________________________________ Adjudication order in respect of Amluckie Investment Company Limited in the matter of Illiquid Stock Options at BSE Page 4 of 18 transfer of erstwhile AO. Subsequently, vide communication order dated January 07, 2020, this case has been transferred to me with advise that except for the change of the Adjudicating Officer the other terms and conditions of the original orders ‘shall remain unchanged and shall be in full force and effect’ and that the “Adjudicating Officer shall proceed in accordance with the terms of reference made in the original orders”. The text of these provisions of PFUTP Regulations are as under

Source: SecMarx — sebi:Order/AP/AS/2019-20/7258. 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.