sebi:Order/KS/AE/2020-21/9666
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Provisions invoked
- s. 15
- s. 11B
- s. 12A
- s. 16
- s. 15G
- s. 15J
- s. 28A
Regulations
- Reg. 3
- Reg. 5
- Reg. 2
- Reg. 2(e)
- Reg. 4(1)
- Reg. 2(1)(d)
- Reg. 2(1)(d)(i)
- Reg. 2(e)(i)
- Reg. 2(1)(n)
- Reg. 2(1)(g)(i)
- Reg. 4(2)
- Reg. 2(d)(i)
Parties
- Amit Ramesh Sawhney
Holding
No final determination is contained in the excerpt; the Show Cause Notice alleges that the Noticee, as a connected person/insider in possession of UPSI regarding Cobrapost's Rs.31,000 crore siphoning allegation, sold his entire holding of 12,497 DHFL shares on January 29, 2019 before the 3 PM publication to avoid loss of Rs.27,716.30.
Full text
Page 2 of 85 press conference on "The Anatomy of India's Biggest Financial Scam" to be scheduled at 3:00 PM on January 29, 2019. However, the name of the company was not announced. Further in this regard, on January 29, 2019, Cobrapost sent an email around 08:27AM to DHFL at their designated email id with a set of 64 questions and asked them to reply before 3PM on the same day. Thereafter, around 10:33 AM on January 29, 2019, Cobrapost sent a reminder email to DHFL with a copy to Kapil Wadhawan, Managing Director of DHFL and Niti Arya, Company Secretary of DHFL. Thereafter, on January 29, 2019 during market hours around 3 PM, Cobrapost conducted a press conference. During the said press conference, Cobrapost alleged that DHFL had siphoned off Rs.31,000 crores into promoter companies to create private wealth through a network of shell companies. The said allegation, being serious in nature, was a price sensitive information which led to fall in the price of the scrip by 8.22% on January 29, 2019.
Page 3 of 85 (Procedure for Holding Inquiry and Imposing Penalties) Rules, 1995 (hereinafter referred to as “Rules”) to inquire into and adjudge under Section 15G of SEBI Act, 1992 the alleged violation of Section 12A(d) & (e) of SEBI Act, 1992 read with Regulation 4(1) of PIT Regulations by the Noticee. SHOW CAUSE NOTICE, REPLY AND PERSONAL HEARING
Page 4 of 85 Financial Scam" to be scheduled at 3:00 PM on January 29, 2019. However, the name of the company was not announced. iii. Thereafter, on January 29, 2019 during market hours around 3 PM, Cobrapost conducted a press conference. During the said press conference, Cobrapost alleged that DHFL had siphoned off Rs.31,000 crores into promoter companies to create private wealth through a network of shell companies. The said allegation, being serious in nature, was a price sensitive information which led to fall in the price of the scrip by 8.22% on January 29, 2019. iv. Since the allegations made by Cobrapost were price sensitive, NSE conducted a preliminary analysis in the scrip of DHFL to identify entities, if any, whose trading pattern pointed trading on the basis of unpublished information on January 29, 2019. NSE forwarded the report to SEBI. v. In this regard, it was observed by SEBI that the said Price Sensitive Information (PSI) had emanated from actions of an outside entity viz. Cobrapost and not by any action of DHFL. Accordingly, SEBI enquired with Cobrapost regarding the details of the press conference including the chronology of the events in relation to the press conference dated January 29, 2019 wherein the PSI was made public. Vide letter dated May 13, 2019 (Annexure 2), Cobrapost submitted a chronology of events in relations to the said press conference which reads as follows: Table 2 Date Event 23/01/2019 Banner upload on Website and facebook COMING SOON
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Source: SecMarx — sebi:Order/KS/AE/2020-21/9666. 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.