sebi:Order/MR/VB/2021-22/15127
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Facts / Headnote
Penalty of INR 5,00,000 imposed on the Noticee for violation of PFUTP Regulations
Provisions invoked
- s. 15H
- s. 15I
- s. 15J
- s. 15
- s. 15F
- s. 28A
Regulations
- Reg. 3
- Reg. 3(a)
Parties
- Sudhir Kumar Agarwal HUF (PAN: AAQHS1781J)
Holding
The Noticee violated regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of the PFUTP Regulations by executing two non-genuine reversal trades in a stock option contract on BSE, and a penalty of INR 5,00,000 was imposed under section 15HA of the SEBI Act.
Full text
Page 2 of 16 B. APPOINTMENT OF ADJUDICATING OFFICER 4. SEBI initiated adjudication proceedings and appointed the undersigned as the adjudicating officer under section 15I of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as the “SEBI Act”) read with rule 3 of the Securities and Exchange Board of India (Procedure for Holding Inquiry and Imposing Penalties) Rules, 1995 (hereinafter referred to as the “Adjudication Rules”) vide order dated April 30, 2021 to inquire into and adjudge under section 15HA of the SEBI Act, against the Noticee for the alleged violation of the aforesaid provisions of the PFUTP Regulations. The said appointment was communicated vide communiqué dated June 28, 2021.
Page 3 of 16 c) In the said contract, the trades entered by the Noticee were reversed with the same counterparty at a substantial price difference without any basis, which indicates that these trades were artificial and non-genuine in nature;
Page 4 of 16 d) That the two trades executed by the Noticee created an artificial volume of 86,000 units which made up 0.001% of the total artificial volume i.e. 8,262,100,000 in the said contract during the investigation period. Further, the allegation in the SCN about 100% of trades of the Noticee being non-genuine is erroneous and Noticee’s share is merely a fraction of the whole volume, if volume generated by all contract traded on that day is considered;
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Source: SecMarx — sebi:Order/MR/VB/2021-22/15127. 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.