sebi:PKK/AO/160/2010
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Facts / Headnote
Penalty imposed on the Noticee for violating PFUTP Regulations, 2003
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 4(1)
Parties
- Mr. Jayesh Shah
Holding
The Noticee, Mr. Jayesh Shah, violated Regulations 4(1), 4(2)(a), 4(2)(b), 4(2)(e) and 4(2)(g) of the PFUTP Regulations, 2003 by acting as one of the connected entities in creating artificial volume and price rise in the scrip of KCL, and a penalty of Rs. 3,00,000/- was imposed under Section 15HA of the SEBI Act, 1992.
Full text
Page 2 of 9 connected entities used to complete many of the market obligations from the shares received through off market. The connected entities were involved in creation of artificial volume and liquidity which led to price increase to unrealistic levels as mentioned above. The investigations revealed that Mr. Jayesh Shah (hereinafter referred to as the ‘Noticee’) is one of the connected entities who has engaged in such activities.
Page 3 of 9 cause as to why an inquiry should not be held against him for the alleged violations. 6. It was alleged in the SCN that the Noticee was one of the 48 entities connected to each other and had acted in tandem in creation of artificial volume and liquidity thereby manipulating the price of KCL during the Investigation Period. The list of the connected entities was provided to the Noticee as an Annexure 1 to the SCN. The connection between the connected entities and their linkages were provided to the Noticee as an Annexure 2 to SCN. The Noticee alongwith the connected entities executed significant numbers of buy and sale transactions in the market and some of the transactions were executed at a price difference of 0.5 % or more than the last traded price or last closing price. Noticee bought 4,82,999 shares of KCL in market through his broker M/s. Vijay B Shah and sold 3,98,678 shares in market through the same broker. The Noticee had also received 2,24,585 shares in off market from Mr. Vijay B Shah, Mr. Prasad Tandel and Girdharbhai J Vagadiya who are allegedly involved in manipulating the scrip of KCL.
Page 4 of 9 affixed at the last known address of the Noticee where the SCN was also pasted. The hearing notice was thus, served on the Noticee in accordance with Rule 7(c) of the Adjudication Rules. The Noticee did not availed the opportunity of personal hearing granted to it. Therefore, the inquiry is proceeded with taking into account the facts and material available on record.
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Source: SecMarx — sebi:PKK/AO/160/2010. 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.