sebi:Order/PM/GD/2021-22/13918

SEBI · SEBI · 2018-04-03 · Prasanta Mahapatra, Adjudicating Officer

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Facts / Headnote

Penalty imposed on the Noticee for violation of PFUTP Regulations, 2003

Provisions invoked

• s. 15
• s. 15H
• s. 15J

Regulations

• Reg. 3
• Reg. 2(1)(c)
• Reg. 3(a)
• Reg. 4(2)(a)
• Reg. 2(1)(c)(2)
• Reg. 2(1)(c)(7)
• Reg. 2(1)(c)(8)

Parties

• Alpna Enterprises

Holding

The Noticee, Alpna Enterprises, 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 illiquid Stock Options contracts on BSE, and a penalty of ₹5,00,000 was imposed under section 15HA of the SEBI Act, 1992.

Full text

Adjudication Order in respect of Alpna Enterprises in the matter of dealings in Illiquid Stock Options at BSE Page 2 of 15 Markets) Regulations, 2003 (hereinafter be referred to as, the PFUTP Regulations, 2003).

Adjudication Order in respect of Alpna Enterprises in the matter of dealings in Illiquid Stock Options at BSE Page 3 of 15 b) That the Noticee engaged in 113 instances in 13 unique contracts which led to generation of artificial volume in these unique contracts. c) The trades entered by the Noticee were reversed on the same day with the same counterparties 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. d) A summary of dealings of the Noticee in the 13 Stock Options contracts in which the Noticee executed non-genuine reversal trades during the Investigation Period are as under: Table 1: Summary of trading of the Noticee in Illiquid Stock Options on BSE e) By indulging in execution of aforesaid non-genuine reversal trades, the Noticee has violated the provisions of regulations 3(a),(b),(c),(d) and 4(1), 4(2)(a) of the PFUTP Regulations, 2003 text of which is reproduced as under:

Adjudication Order in respect of Alpna Enterprises in the matter of dealings in Illiquid Stock Options at BSE Page 4 of 15 3. Prohibition of certain dealings in securities No person shall directly or indirectly – (a) buy, sell or otherwise deal in securities in a fraudulent manner; (b) use or employ, in connection with issue, purchase or sale of any security listed or proposed to be listed in a recognized stock exchange, any manipulative or deceptive device or contrivance in contravention of the provisions of the Act or the rules or the regulations made thereunder; (c) employ any device, scheme or artifice to defraud in connection with dealing in or issue of securities which are listed or proposed to be listed on a recognized stock exchange; (d) engage in any act, practice, course of business which operates or would operate as fraud or deceit upon any person in connection with any dealing in or issue of securities which are listed or proposed to be listed on a recognized stock exchange in contravention of the provisions of the Act or the rules and the regulations made there under.

Source: SecMarx — sebi:Order/PM/GD/2021-22/13918. 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.