sebi:VSS/AO-147/2009
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Facts / Headnote
Charges proved; penalty of Rs.75,000 imposed (Rs.25,000 under section 15HA and Rs.50,000 under section 15HB of SEBI Act)
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 7
- Reg. 4
- Reg. 3
- Reg. 4(1)
- Reg. 4(2)(a)
- Reg. 4(2)(e)
- Reg. 4(2)(g)
- Reg. 4(2)(b)
Parties
- Khambatta Securities Limited
Holding
The Noticee, Khambatta Securities Ltd., was held to have violated regulations 4(1), 4(2)(a), (b), (e) and (g) of PFUTP Regulations and clauses A(1) to (5) of the Code of Conduct for Stock Brokers by allowing its client to execute manipulative trades in partly paid up shares of RSL. A total penalty of Rs.75,000 was imposed under sections 15HA and 15HB of the SEBI Act.
Full text
Page 2 of 19 b. 23,35,44,861 new equity shares were issued and allotted to promoters, their associates and lenders against funds brought in by them. c. The equity share capital was comprised of 29,55,80,111 equity shares including 4,15,24,000 equity shares (face value Rs.10/- each) of partly paid up to the extent of Re.1/- per share. The partly paid up shares were allotted to Reliance Hydrocarbons and Investments Private Limited (now known as Silvassa Hydrocarbons and Investments Private Limited). d. The partly paid up shares were permitted for trading at the Bombay Stock Exchange (hereinafter referred to as “BSE”) with effect from March 19, 2003.
Page 3 of 19 4. The entities found to have been involved in the alleged manipulation are as under:- Short Name Full Name TRP Trambaklal Ratilal Parekh & Son Securities Ltd. KS Khambatta Securities Limited HH Harikishan Hiralal (currently known as Shreehari Hira Stock Broking Pvt. Ltd.) PI Pioneer Intermediaries Pvt. Ltd. JSELS JSEL Securities SC Sundeep R Chhabra RI Raushee Investments RSG R S Gupta & Co MJ Manorama Jagad SP Swati Purana MP Milan Purana BT Bhanumati Thakkar BRJ Bipinkumar R Jain PB Pramod Bissa SKJ Sanjay Kr. Jaganary
Page 4 of 19 5. It was alleged that one of the brokers, viz., Khambatta Securities Ltd., Member, BSE (hereinafter referred to as “Noticee”/“KSL”) who executed trades in RSL for its client, Bipinkumar R Jain, violated the provisions of regulations 4 (1), 4 (2) (a), (b), (e) and (g) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Markets) Regulations, 2003 (hereinafter referred to as “PFUTP”) and clauses A (1), (2), (3), (4) and (5) of Code of Conduct for Stock Brokers as specified in Schedule II under Regulation 7 of SEBI (Stock Brokers and Sub Brokers) Regulations (hereinafter referred to as “Brokers Regulations”), and therefore, liable for monetary penalty under sections 15HA and 15HB of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as “SEBI Act”).
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Source: SecMarx — sebi:VSS/AO-147/2009. 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.