sebi:Order/SBM/AK/2022-23/16301

SEBI · SEBI · 2021-07-27 · Suresh B Menon, 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

Violation established; penalty of Rs.5,00,000 imposed under Section 15HA

Provisions invoked

• s. 15
• s. 19
• s. 15H
• s. 15J
• s. 28A

Regulations

• Reg. 3
• Reg. 4(1)
• Reg. 3(a)

Parties

• Anirudh Damani HUF

Holding

The Adjudicating Officer held that Anirudh Damani HUF violated Regulations 3(a), 4(1) and 4(2)(a) of the PFUTP Regulations by executing 4 non-genuine reversal trades in 2 illiquid stock option contracts at BSE creating artificial volume of 2,11,500 units, and imposed a penalty of Rs.5,00,000 under Section 15HA of the SEBI Act.

Full text

___________________________________________________________________________ Adjudication order in respect of Anirudh Damani HUF in the matter of dealing in Illiquid Stock Options at BSE Page 2 of 12 Noticee had entered into reversal trades with its counterparties which involved squaring off transactions with significant difference in sell value and buy value of the transactions. It was therefore alleged that Noticee had executed the reversal trades, which were non-genuine in nature and have created false or misleading appearance of trading in terms of creation of artificial volume in the Stock Options segment at BSE and therefore, it is alleged that the Noticee has violated the provisions of regulations 3(a), (b), (c), (d) and regulation 4(1), 4(2) (a) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Markets) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’). In view of the above reasons, adjudication proceedings have been initiated against the Noticee under the provisions of section 15 HA of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as ‘SEBI Act’). APPOINTMENT OF ADJUDICATING OFFICER

___________________________________________________________________________ Adjudication order in respect of Anirudh Damani HUF in the matter of dealing in Illiquid Stock Options at BSE Page 3 of 12

___________________________________________________________________________ Adjudication order in respect of Anirudh Damani HUF in the matter of dealing in Illiquid Stock Options at BSE Page 4 of 12 b. Trades were done with profit making objective and were done on BSE platform. Trades were of miniscule % of the BSE derivatives system. No unfair gains or unfair advantage derived. No loss has been caused to any investors. The trades are not repetitive and were one off instance. c. Traded in ordinary course in the anonymous screen based system of the exchanges. At no point was part of any scheme, plan, device or artifice. Have no relation with any of the counterparties.

Source: SecMarx — sebi:Order/SBM/AK/2022-23/16301. 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.