sebi:PKK/AO/178/2010
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Facts / Headnote
Violation established; monetary penalty of Rs. 2,00,000 imposed on the Noticee under Section 15HA of the SEBI Act.
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 3(a)
Parties
- Mr. Nirmal Jain
Holding
The Noticee, Mr. Nirmal Jain, was found to have violated Regulations 3(a), (b), (c), and (d) of the PFUTP Regulations, 2003 by engaging in off-market and synchronized trades with connected entities that created a misleading appearance of trading and artificial volume in the scrip of MCL, and a monetary penalty of Rs. 2,00,000 was imposed under Section 15HA of the SEBI Act.
Full text
Page 2 of 8 till further directions are given. Mr. Nirmal Jain was one of the entities named in the said Order. 3. The investigations revealed that 42 entities were allegedly involved in manipulating the price of MCL. Out of the 42 entities, 33 entities were allegedly found to be connected to each other. They had common address and/or common contact number. Further, some of the connected entities transferred shares of MCL among themselves through off market trades and some of them shared common directorships in associate companies. These entities apparently entered into off-market/synchronized and structured deals that led to creation of misleading appearance of trading and artificial volume in the scrip. The dealings of the above nature had distorted market equilibrium leading to sudden spurt in the volume and price of the scrip.
Page 3 of 8 Show Cause Notice, Reply & Personal hearing 6. A Notice dated May 22, 2008 (SCN) was issued to the Noticee in terms of the provisions of Rule 4 (1) of the Adjudication Rules to show cause as to why an inquiry should not be held against him in respect of the violations alleged to have been committed. The SCN was sent through Registered Post A.D. and the same was returned undelivered. Subsequently, the SCN was duly served on the Noticee by affixture at its last known address as provided for in the Rule 7 (3) of the Adjudication Rules.
Page 4 of 8 10. The Noticee did not appear before me for the personal hearing. I, therefore, proceed with the inquiry taking into account the facts and material available on record.
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Source: SecMarx — sebi:PKK/AO/178/2010. 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.