sebi:Order/VV/AA/2021-22/12806
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Facts / Headnote
Alleged violations of Section 12A of SEBI Act and Regulations 3(a), 3(b), 3(c), 3(d), 4(1), 4(2)(a), 4(2)(b), 4(2)(e) of PFUTP Regulations found established against the Noticee; SCN issued under Rule 4 of Adjudication Rules for penalty under Section 15HA
Provisions invoked
- s. 15
- s. 12A
- s. 15H
- s. 15I
- s. 15J
- s. 15F
- s. 28A
- s. 24
Regulations
- Reg. 4
- Reg. 3
- Reg. 4(a)
- Reg. 3(a)
Parties
- Noticee (name not stated in excerpt; associated with Priyanka Darshan Desai, Amol Kokane, ICMPL Borivali West branch)
Holding
The Noticee was found to have executed synchronized/reversal trades in PSTL shares across accounts he operated (Priyanka Darshan Desai, Amol Kokane, and others), in collusion with Nirmal Kotecha's scheme to manipulate PSTL, thereby violating Section 12A of the SEBI Act and Regulation 4 of the PFUTP Regulations.
Full text
Page 2 of 28 (hereinafter referred to as “SAST Regulations”) for an additional 20% stake at a price not less than Rs. 250/- within 14 days, for allegedly violating creeping acquisition norms. With the reports in the media appearing about the impending offer at Rs. 250/-, the price of the shares of PSTL increased on December 22, 2008, when the stock markets opened for the day. On December 22, 2008, PSTL first informed BSE Limited (hereinafter referred to as “BSE”) and National Stock Exchange of India Limited (hereinafter referred to as “NSE”) that the company had not received any communication from SEBI regarding the media reports on Open Offer. BSE disseminated the said disclosure made by PSTL at 10:28:04 AM on December 22, 2008 on its website, while NSE disseminated the same at 10:30:00 AM on the same day.
Page 3 of 28 consequent to the publication of news about the forged SEBI letter. It was also found that some persons/ entities had sold PSTL shares on December 22, 2008 and bought back the shares at lower prices on the same day taking advantage of both the price rise which occurred due to publication of the forged SEBI letter as well as the price fall which occurred due to a clarification on media reports on Open Offer provided by Mr. P.S. Saminathan to the stock exchanges (BSE and NSE) that the company had not received any communication directing Mr. P. S. Saminathan to make open offer.
Page 4 of 28 Kokane, a front entity of Nirmal Kotecha, and Priyanka Darshan Desai and executed synchronized/ structured deals with entities associated with Nirmal Kotecha. There were also reversals of positions in the two accounts being operated by the Noticee by executing synchronized/ structured deals. This manner of trading enabled the Nirmal Kotecha associated entities to create an appearance of trading in the stock market in the shares of PSTL which in turn enabled Nirmal Kotecha to offload his shares in PSTL. The Noticee in connivance with Amit N. Joshi, Branch Manager, Rashmi Building, Borivali (West) branch of ICMPL, executed synchronized reversal/ circular transactions while trading on behalf of his wife Priyanka Darshan Desai and on behalf of Amol Kokane. The Noticee also arranged funds for Amol Kokane, through Nitin Goradia, and also stood as a guarantor for the same. In view of all of the above, Adjudication Proceedings were initiated against the Noticee and it was alleged that the Noticee had violated the provisions of Section 12A of SEBI Act and Regulation 3(a), 3(b), 3(c), 3(d), 4(1), 4(2)(a), 4(2)(b) and 4(2)(e) of PFUTP Regulations,
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Source: SecMarx — sebi:Order/VV/AA/2021-22/12806. 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.