sebi:SD/AO/155/2009
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Facts / Headnote
Penalty of Rs. 75,000 imposed on the Noticee for violation of Regulations 4(1) and 4(2)(a) of the PFUTP Regulations, 2003; allegation under Regulation 4(2)(e) not proved
Provisions invoked
- s. 15H
- s. 15I
- s. 15J
- s. 15
Regulations
- Reg. 3
- Reg. 4
- Reg. 4(1)
- Reg. 4(2)(a)
- Reg. 4(2)(e)
Parties
- Ramesh Chandra K Jain
Holding
The Noticee, Ramesh Chandra K Jain, was held to have violated Regulations 4(1) and 4(2)(a) of the PFUTP Regulations, 2003 by engaging in synchronized/structured trades with connected clients creating a false or misleading appearance of trading, and was imposed a penalty of Rs. 75,000 under Section 15HA of the SEBI Act; however, the allegation of violating Regulation 4(2)(e) (manipulation of price) was not proved.
Full text
Page 2 of 14 February 25, 2005, the price of the scrip has decreased from Rs. 140 to Rs. 91.95. Secondly, the major clients dealing in the scrip were connected/related clients viz., Ramniklal Patel, Vikas Narnavar, Rameshchandra Jain, Amul Seth and Jayesh Shah who have dealt through four members viz., Pilot Credit Capital Ltd., Adolf Pinto, Pawan J Choudhri, M/s. Harikishan Hiralal, and have purchased 12,916 shares and sold 14,225 shares accounting for around 58% of market purchases and 64% of market sales during entire period under examination.
Page 3 of 14 on November 22, 2004 to Rs.180.00 on November 23, 2004 and then declined to Rs.35.15. The volume was the highest i.e., 3005 shares on February 7, 2005. Further, during the said period, price of the scrip witnessed fluctuations opposite to the direction of sensex i.e., when the price was decreasing, sensex was increasing and vice-versa.
Page 4 of 14 11. The major clients were Ramniklal Patel, Vikas Narnavar, Rameshchandra Jain (hereinafter referred to as the ‘Noticee’), Amul Seth and Jayesh Shah. These clients together purchased 12916 shares and sold 14225 shares accounting to 57.78% and 63.64% of the market volume of 22, 352 shares. It was observed that these clients were connected to each other and they traded through more than one broker, the details of which are given as follows: Client Member Gross Purchases Avg Price (Rs.) Gross Sales Avg Price (Rs.) Connection/Relation Ramniklal Patel 10540, R008 Pilot Credit Capital Ltd. 9251 102.15 1425 114.16 The Clients Ramniklal Patel and Jayesh Shah have the same address. Ramniklal Patel 10540, R008 Pawan J Choudhri 10 49.5 300 57.12 Ramniklal patel was introduced by Vikas Narnavar Vikas Narnavar V036, 12424 Adolf pinto 1705 104.24 8625 86.52 Vikas Narnavar was introduced by Ramesh Chandra Jain Vikas Narnavar V036, 12424 Pilot Credit Capital Ltd 300 57.12 0 0
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Source: SecMarx — sebi:SD/AO/155/2009. 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.