sebi:Order/BM/JR/2023-24/27718
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Facts / Headnote
Violation established; penalty of Rs. 5,00,000 imposed under Section 15HA, payable within 45 days
Provisions invoked
- s. 11B
- s. 11
- s. 15
- s. 19
- s. 15H
- s. 15J
- s. 15F
- s. 28A
Regulations
- Reg. 4
- Reg. 3
- Reg. 4(1)
- Reg. 3(a)
- Reg. 26
Parties
- N. K. Agarwal and Others HUF
Holding
The Noticee violated Regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of PFUTP Regulations, 2003 by executing 5 non-genuine reversal trades in 2 illiquid BSE stock option contracts creating artificial volume of 294000 units, and is liable to a monetary penalty of Rs. 5,00,000 under Section 15HA of the SEBI Act, 1992.
Full text
Adjudication Order in respect of N.K. Agarwal and Others HUF in the matter of trading in Illiquid Stock Options at BSE P a g e | 2 of 20 Agarwal and Others HUF (PAN – AAFHN3050E) (hereinafter referred to as the “Noticee”) was one of the various entities who indulged in execution of reversal trades in stock options segment of BSE during the IP. Such trades were alleged to be non-genuine in nature and created false or misleading appearance of trading in terms of artificial volumes in stock options and therefore were alleged to be manipulative, deceptive in nature. In view of the same, SEBI initiated adjudication proceedings against the Noticee for alleged violation of the provisions of Regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 (hereinafter referred to as “PFUTP Regulations, 2003”).
Adjudication Order in respect of N.K. Agarwal and Others HUF in the matter of trading in Illiquid Stock Options at BSE P a g e | 3 of 20
Adjudication Order in respect of N.K. Agarwal and Others HUF in the matter of trading in Illiquid Stock Options at BSE P a g e | 4 of 20 c) 100% of volume generated by Noticee in the above contracts was alleged to be artificial volume and further, the percentage of alleged artificial volume generated by the Noticee in the above contract to the total volume from the market in said contract was in the range of 4.69% - 7.56%. Therefore, the Noticee allegedly generated artificial volume in the above contracts.
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Source: SecMarx — sebi:Order/BM/JR/2023-24/27718. 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.