sebi:WTM/AB/IVD/ID2/7988/2020-21
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Facts / Headnote
Directions issued under Sections 11 and 11B of the SEBI Act against Noticees no. 1, 3, 4, 5 and 7; proceedings against Noticee no. 6 abated due to death; no further restraint required against Noticees no. 2 and 8; Noticee no. 9 (Nimesh Chitalia) exonerated for insufficient evidence.
Provisions invoked
- s. 11
- s. 19
- s. 12A
- s. 12
- s. 24
Regulations
- Reg. 4
- Reg. 11
- Reg. 3
- Reg. 3(a)
Parties
- Darshan Desai (Noticee no. 1)
- Nitin Goradia (Noticee no. 2)
- Amit N. Joshi (Noticee no. 3)
- Noticee no. 4
- Yatin B. Shah (Noticee no. 5)
- Jayesh Shah (Noticee no. 6)
- Rajesh Jani (Noticee no. 7)
- Dynamic Stock Broking Pvt. Ltd (Noticee no. 8)
- Nimesh Chitalia (Noticee no. 9)
Holding
The Whole Time Member of SEBI held that Noticees no. 1 (Darshan Desai), 3 (Amit N. Joshi), 4, 5 (Yatin B. Shah) and 7 (Rajesh Jani) violated Section 12A of the SEBI Act and Regulations 3(a)-(d), 4(1), 4(2)(a) and (e) of the PFUTP Regulations, and issued directions under Sections 11 and 11B restraining them from accessing the securities market for varying periods. Noticee no. 9 (Nimesh Chitalia) was held not liable due to insufficient evidence, and proceedings against Noticee no. 6 (Jayesh Shah) were abated due to his death.
Full text
Final Order in the matter of Pyramid Saimira Theatre Limited Page 2 of 99 ordered P.S. Saminathan, one of the promoters of Pyramid Saimira Theatre Limited (hereinafter referred to as “PSTL”), to make an open offer under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (hereinafter referred to as “SAST Regulations”) for an additional 20% stake at a price not less than Rs 250/- within 14 days, for allegedly violating creeping acquisition norms. With the reports in the media appearing about the impending offer at Rs 250/-, the shares of the company shot up on Monday morning i.e. December 22, 2008, when the stock markets opened for the day. On December 22, 2008, PSTL first informed the Bombay Stock Exchange Limited (hereinafter referred to as “BSE”) and National Stock Exchange of India Limited (hereinafter referred to as “NSE”) in the morning that the company had not received any communication from SEBI regarding the media reports on Open Offer. BSE disseminated the denial by the company at 10:28:04 a.m. on December 22, 2008 on its website and NSE did so at 10:30:00 a.m. on same day.
Final Order in the matter of Pyramid Saimira Theatre Limited Page 3 of 99 15-19, 2008 and sold these shares on December 22, 2008 i.e. after the price rise in the shares on December 22, 2008 consequent to the publication of the forged SEBI letter. It was also found that some persons/ entities had sold PSTL shares on December 22, 2008 and bought back the shares at lower prices on the same day taking advantage of both the price rise which occurred due to the publication of the forged SEBI letter as well as the price fall which occurred due to a clarification issued by P.S. Saminathan that the company had not received any communication from SEBI directing P. S. Saminathan to make open offer.
Final Order in the matter of Pyramid Saimira Theatre Limited Page 4 of 99 against Dynamic Stock Broking Pvt. Ltd (Noticee no. 8) vide ad interim ex parte
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Source: SecMarx — sebi:WTM/AB/IVD/ID2/7988/2020-21. 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.