sebi:Order/SR/PP/2020-21/7500/3

SEBI · SEBI · 2000-03-02 · Sangeeta Rathod, Adjudicating Officer

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Facts / Headnote

The excerpt finds established violations by Abhay Javlekar of Regulations 10 and 11(1) of the SAST Regulations, the cited PFUTP provisions, and the cited SCRA provisions. It does not disclose a penalty or the final disposition of the disclosure-related allegations.

Provisions invoked

• s. 11B
• s. 15A
• s. 15
• s. 12A
• s. 11
• s. 15H
• s. 13
• s. 15J
• s. 28A
• s. 23J
• s. 23
• s. 23H
• s. 16
• s. 17
• s. 18

Regulations

• Reg. 3
• Reg. 7(1)
• Reg. 11
• Reg. 4(1)
• Reg. 199
• Reg. 2(1)(e)
• Reg. 10
• Reg. 13(1)
• Reg. 2
• Reg. 11(1)
• Reg. 3(a)
• Reg. 4(2)(a)
• Reg. 18
• Reg. 12(2)
• Reg. 2(1)(e)(1)

Parties

• Abhay Javlekar

Holding

The Adjudicating Officer found that Javlekar acted in concert with Arvind Goyal and failed to make the open offer required by SAST Regulations 10 and 11(1). The excerpt also finds established PFUTP and SCRA violations; it does not show a finding on the disclosure allegations or state any penalty.

Full text

Adjudication Order in respect of Abhay Javlekar in the matter of Incap Financial Services Limited . Page 2 of 28 2. On the basis of the aforementioned complaint, a department of SEBI (in short OD) appointed Investigating Authority (in short IA) and undertook an investigation in the matter for a period from December 1, 2010 to February 23, 2011 (hereinafter referred to as Investigation period / IP ) to ascertain whether there was any violation of (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 (in short PFUTP Regulations), the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (in short SAST Regulations) and the SEBI (Prohibition of Insider Trading) Regulations, 1992 (in short PIT Regulations). The shares of Incap were listed at Bombay Stock Exchange Limited during IP. IA observed non-compliances with regard to SEBI Act, SCRA, PFUTP Regulations, SAST Regulations and PIT Regulations by Abhay Javlekar (hereinafter referred to as Noticee) and others.

Adjudication Order in respect of Abhay Javlekar in the matter of Incap Financial Services Limited . Page 3 of 28 under section 15-I of the SEBI Act read with (r/w) rule 3 of the Securities and Exchange Board of India (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules,1995 (in short AO Rules, 1995) and also section 23-I of SCRA r/w rule 3 of Securities Contracts (Regulation) (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 2005 (in short AO Rules, 2005) to inquire into and adjudge under section 15A(b), 15H, 15HA of the SEBI Act the alleged violations of regulation 7(1), 7(1A), 10, 11(1) of SAST Regulations, regulation 13(1) & 13(3) of PIT Regulations, sections 12A(a), (b), (c) of SEBI Act r/w regulation 3(a), (b), (c) & (d) and 4(1), 4(2)(a)&(g) of PFUTP Regulations and under section 23H of SCRA, the alleged violations of section 16 of SCRA r/w SEBI Notification G.S.R.219(E) dated March 2, 2000, sections 13 & 18 r/w section 2(i) of SCRA by the Noticee. Subsequently, the matter was transferred and Ms. Sangeeta Rathod (undersigned) was appointed an AO in this matter. The appointment of undersigned as AO was communicated vide order dated July 10, 2017. SHOW CAUSE NOTICE, REPLY AND PERSONAL HEARING

Adjudication Order in respect of Abhay Javlekar in the matter of Incap Financial Services Limited . Page 4 of 28 i) Noticee has triggered open offer obligations on 30th September, 2010 under Regulation 10 and on 16th October, 2010 under Regulation 11(1) of the SEBI SAST Regulations. It is alleged that the combined shareholding of Dharmendra Bhojak, Arvind Babulal Goyal and Noticee being PACs, crossed 15% of issued capital of Incap on 30th September, 2010 and further 5% twice, once on 16th October, 2010 and once along with Pooja Goyal and Ramesh Dwarkades Daga on 6th December, 2010, of shares of Incap, which allegedly attracted the provision of regulation 10 & 11(1) of the SAST Regulations, 1997, however, no open offer was given under the SAST Regulations, 1997. Therefore, Noticee being PAC, have failed to comply with the provisions of regulations 10 & 11(1) of the SAST Regulations, 1997. Further, it is alleged that Noticee has failed to make disclosure for change in shareholding as PAC as required under regulation 7(1) & 7(1A) of SAST Regulations, 1997. It is also alleged that Noticee has failed to file disclosures with the company under regulation 13(1) and 13(3) of SEBI PIT Regulations, 1992 for change in shareholding. ii) Noticee has indulged in unfair trade practice by using the accounts of other suspected entities for reversal, synchronised trades and self-trades resulting in creation of artificial volume, thereby prima facie, acted in violation of section 12A(a), (b), (

Source: SecMarx — sebi:Order/SR/PP/2020-21/7500/3. 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.