sebi:SD/AO/82/2009
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Facts / Headnote
Penalty of Rs. 5,00,000 imposed under Section 15HA of the SEBI Act
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 2(1)(c)
- Reg. 3(a)
Parties
- Shri Rajesh Panchal
Holding
The Noticee violated Regulations 3(a),(b),(c),(d), 4(1) and 4(2)(a),(b),(e) and (g) of the PFUTP Regulations and is liable for monetary penalty of Rs. 5,00,000 under Section 15HA of the SEBI Act.
Full text
Page 2 of 11 Prashant Narvekar, Ramesh Jain, Sicorp Finlease Limited, Ravi Panchal, Jignesh Shah and Rajesh Panchal. 2. During this period of investigation, the price of the scrip of FTEL was increased from Rs 13.16 on January 01,2004 to Rs 58.05 on June 30,2004 witnessing an increase of 341% in the scrip price of FTEL in just six months. The investigation report revealed that the scrip of FTEL was thinly traded before the investigation period. The information available on BSE website shows that 15,45,500 shares of FTEL were traded during the calendar year of 2003. Whereas the traded volume in the scrip of FTEL during the investigation period were 85,15,574 shares. As per the Investigation Report (hereinafter referred to as ‘IR’) various entities including the promoters of FTEL, some brokers and connected clients were allegedly found to have involved in the activities of manipulation of the scrip price of FTEL, a thinly traded scrip. The activities of these entities facilitated the creation of artificial volumes and influenced the price of the scrip of FTEL in the securities market.
Page 3 of 11 APPOINTMENT OF ADJUDICATING OFFICER : 4. The undersigned was appointed as the Adjudicating Officer vide order of SEBI dated 20th February,2008 under section 15-I of the SEBI Act r/w Rule 3 of SEBI (Procedure for holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules,1995 (hereinafter referred to as the ‘Adjudicating Rules’) to inquire into and adjudge under Section 15HA of the SEBI Act, the alleged violations PFUTP Regulations committed by the Noticee. SHOW CAUSE NOTICE/REPLY/PERSONAL HEARING :
Page 4 of 11 proceeded on the basis of the material available on record . CONSIDERATION OF ISSUES AND FINDINGS : 6. In the instant matter the following issues arise for consideration : a. Whether the Noticee had violated Regulations 3(a),(b),(c),(d),4(1),4(2)(a),(b),(e) and (g) of the PFUTP Regulations ? b. Whether the Noticee is liable for monetary penalty prescribed under section 15HA of the SEBI Act. ? c. If, yes what should be the quantum of monetary penalty ?
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Source: SecMarx — sebi:SD/AO/82/2009. 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.