sebi:Order/PM/PA/2021-22/15358

SEBI · SEBI · 2015-05-08 · Prasanta Mahapatra, Adjudicating Officer

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Penalty imposed of Rs 5,00,000/-

Provisions invoked

• s. 11(4)
• s. 15
• s. 19
• s. 12A
• s. 15H
• s. 15J
• s. 23E

Regulations

• Reg. 3
• Reg. 7
• Reg. 3(a)

Parties

• Rajendrakumar Chhotamalji Mehta

Holding

The Noticee violated section 12A(a), (b) and (c) of the SEBI Act and regulations 3(a), (b), (c), (d), 4(1), 4(2)(a), 4(2)(e) and 4(2)(g) of the PFUTP Regulations by executing self-trades that created a false or misleading appearance of trading in PAL's scrip, and a penalty of Rs 5,00,000/- was imposed under section 15HA of the SEBI Act.

Full text

Adjudication Order in respect of Rajendrakumar Chhotamalji Mehta Page 2 of 21 In the matter of Pine Animation Limited The aforesaid suspension was revoked with effect from June 22, 2012, however, trading in the scrip started only on March 28, 2013.

Adjudication Order in respect of Rajendrakumar Chhotamalji Mehta Page 3 of 21 In the matter of Pine Animation Limited 5. The investigation inter alia concluded that the Company, its directors, certain entities associated with the Company/promoters, and other connected entities were part of a fraudulent scheme wherein the price of PAL’s scrip was manipulated. It was observed that the scheme deployed by the aforesaid entities ran in the following manner, the promoters of the Company transferred their entire shareholding through off-market trades to certain entities who were allegedly connected with the Company, such entities in turn, transferred the physical shares through off-market deals to certain other entities who finally sold them on the stock exchange at artificially inflated prices. In relation to the above, it was observed that Rajendrakumar Chhotamalji Mehta (hereinafter referred to as “Noticee”) had participated in the aforesaid scheme by manipulating the price of PAL’s scrip by executing self-trades which created false or misleading appearance of trading in the scrip. Further, it was observed that self-trades executed by the Noticee had contributed 6.09% to market negative last traded price (hereinafter referred to as “LTP”).

Adjudication Order in respect of Rajendrakumar Chhotamalji Mehta Page 4 of 21 In the matter of Pine Animation Limited the PFUTP Regulations. The appointment of the adjudicating officer was communicated vide communiqué dated December 27, 2017.

Source: SecMarx — sebi:Order/PM/PA/2021-22/15358. 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.