sebi:WTM/AN/MIRSD/DOP/28477/2023-24
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Facts / Headnote
Noticee held not to satisfy 'fit and proper person' criteria; cancellation of registration certificate and directions under regulation 27 held infructuous/not feasible as registration was surrendered before action was approved.
Provisions invoked
- s. 19
- s. 11(4)
- s. 11B
- s. 27
- s. 173
- s. 29
- s. 12(3)
- s. 154
- s. 20
- s. 29A(2)
- s. 133B
- s. 209A
Regulations
- Reg. 23
- Reg. 7
- Reg. 28
- Reg. 27
- Reg. 21
- Reg. 28(1)
- Reg. 6
- Reg. 2(1)
- Reg. 27(1)
- Reg. 5(e)
- Reg. 9(b)
- Reg. 2(1)(b)
- Reg. 2(1)(g)
Parties
- CD Commosearch Pvt. Ltd.
Holding
The Noticee, CD Commosearch Pvt. Ltd., does not satisfy the 'fit and proper person' criteria under Schedule II to the SEBI (Intermediaries) Regulations, 2008, on account of its participation in paired contracts on NSEL and the pendency of a chargesheet against it; however, no cancellation of registration or directions under regulation 27 are issued as the registration was surrendered before the action was approved.
Full text
Order in respect CD Commosearch Pvt. Ltd. in the matter of NSEL Page 2 of 43 Report; (ii) Finance Ministry letter dated December 30, 2014 to Forwards Market Commission (“FMC”); (iii) Hon’ble Bombay HC’s order in criminal bail application no. 1263 of 2014 in Jignesh Prakash Shah vs. State of Maharashtra dated August 22,
Order in respect CD Commosearch Pvt. Ltd. in the matter of NSEL Page 3 of 43 personal hearing, before concluding the present proceedings. Accordingly, a supplementary SCN dated February 27, 2023 (“SSCN”) was served on the Noticee along with the following documents: (i) Copy of SEBI complaint dated September 24, 2018 filed with Economic Offences Wing (“EoW”); (ii) Copy of FIR dated September 28, 2018 filed by SEBI under section 154 of Criminal Procedure Code, 1973 (“CrPC”); (iii) Amended Schedule II of Intermediaries Regulations; and (iv) Copy of chargesheet dated December 02, 2022.
Order in respect CD Commosearch Pvt. Ltd. in the matter of NSEL Page 4 of 43 March 11, 2019, certain documents said to be relied upon by the DA in issuing DA SCN were provided. Thus, the allegations of DA preceded the documents said to be relied upon by the DA. Forwarding some relied upon documents in aforesaid manner after 6 months of issuing DA SCN and 3 months after receiving reply from the Noticee is an afterthought.
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Source: SecMarx — sebi:WTM/AN/MIRSD/DOP/28477/2023-24. 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.