sebi:Order/PB/S./2021-22/15060
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Facts / Headnote
Penalty imposed on the Noticee for violation of PFUTP Regulations, 2003
Provisions invoked
- s. 15
- s. 19
- s. 15H
- s. 15J
- s. 15F
- s. 28A
Regulations
- Reg. 3
- Reg. 3(a)
Parties
- Nishul Jain
Holding
The Noticee was found to have violated regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of the PFUTP Regulations, 2003 by executing non-genuine reversal trades in stock options contracts at BSE, and a penalty of ₹5,00,000 was imposed under section 15HA of the SEBI Act, 1992.
Full text
Page 2 of 27 2. Pursuant to investigation, it was observed that total 2,91,744 trades comprising substantial 81.4% of all the trades executed in stock options segment of BSE during the IP were non genuine trades. It was observed that Nishul Jain (PAN: AVPPJ8739B) (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 observed 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 and deceptive in nature. In view of the same, SEBI initiated adjudication proceedings against the Noticee for 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 relating to Securities Market) Regulations, 2003 (hereinafter referred to as “PFUTP Regulations, 2003”).
Page 3 of 27 penalty is liable, impose such penalty deemed fit in terms of rule 5 of Adjudication Rules and section 15HA of SEBI Act, 1992.
Page 4 of 27 (a) The Noticee has executed non genuine trades in 2 contracts, wherein all the trades of the Noticee in the said contracts were non genuine trades. (b) Percentage of non-genuine trades of the Noticee in 2 stock options contracts to total trades in the said contracts were in the range of 25% to 50%. The non-genuine trades of the Noticee have significantly contributed to total trades in the market in the above contracts. (c) The percentage of artificial volume generated by the Noticee in the above contracts to the total volume from the market in the said contracts was in the range of 7.69% to 61.54%. Therefore, substantial volume generated by the Noticee in the above contracts were artificial volume. (d) Non genuine trades executed by the Noticee in the above contracts had significant difference in buy rates and sell rates considering that the trades were reversed on same day.
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Source: SecMarx — sebi:Order/PB/S./2021-22/15060. 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.