sebi:VSS/AO-28/2008

SEBI · SEBI · 2006-12-12 · V.S. Sundaresan, Adjudicating Officer

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Facts / Headnote

Penalty imposed on the Noticee for violation of regulations 4(2)(a) and 4(2)(e) of PFUTP

Provisions invoked

• s. 15
• s. 15H
• s. 15J

Regulations

• Reg. 4
• Reg. 4(2)
• Reg. 47
• Reg. 2(1)

Parties

• M/s PRJ Finance Pvt. Ltd. (PFPL)

Holding

The Noticee, M/s PRJ Finance Pvt. Ltd., was held liable for violating regulations 4(2)(a) and 4(2)(e) of PFUTP by indulging in synchronized and structured trades in the scrip of GBFL through brokers ASBPL and SK, creating artificial volumes in an illiquid scrip, and a monetary penalty of Rs. 50,000 was imposed under section 15HA of the SEBI Act.

Full text

Page 2 of 15 1. GBFL M/s Goenka Business and Finance Limited 2. ASBPL M/s Ashish Stock Broking Pvt. Ltd. 3. SK M/s Sunil Kedia

Page 3 of 15 APPOINTMENT OF ADJUDICATING OFFICER 5. Mr. Piyoosh Gupta was appointed as Adjudicating Officer vide order dated December 12, 2006 under section 15 I of SEBI Act read with rule 3 of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 (hereinafter referred to as ‘Rules’) to inquire into and adjudge the alleged violations of regulations 4(2) (a) and 4(2) (e) of PFUTP committed by PFPL.

Page 4 of 15 9. In the interest of natural justice and in order to conduct an inquiry as per rule 4 (3) of the Rules, the Noticee was granted an opportunity of personal hearing on April 24, 2008 at SEBI’s Eastern Regional Office, Kolkata vide notice dated March 18, 2008. Mr. Anand Kumar Tiwari, Partner, S.K. Agarwala & Co., Chartered Accountants, Advocates & Legal consultants, the authorized representative of the Noticee, appeared on behalf of the Noticee (hereinafter referred to as “AR”) on April 23, 2008. During the hearing, the AR reiterated the submissions made vide letter dated January 12, 2008. The AR submitted that PFPL had bought and sold shares of GBFL through ASBPL on different dates. PFPL had dealt in the shares and there was no intention to manipulate. When queried as to whether Mr. Deepak Gupta and Mr. Prabhat Goyal, Directors of PFPL are also Directors on the Board of M/s Ideal Motor and Finance Pvt. Ltd. (hereinafter referred to as “IMFPL”) and M/s Karikish Vyaper Pvt. Ltd., (hereinafter referred to as “KVPL”) and M/s Estee Carriers Pvt.Ltd.(hereinafter referred to as “ECPL”), who have also traded in the scrip of GSSL, the AR confirmed the same. As regards the common address amongst PFPL, IMFPL, KVPL and ECPL i.e.14, Ganesh Chandra Avenue, Kent House, 4th Floor, Kolkata-13, the AR submitted that there are many offices in this premises and each one was operating from their own premises.

Source: SecMarx — sebi:VSS/AO-28/2008. 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.