sebi:WTM/ASB/IVD/ID16/19713/2022-23
Facts / Headnote
AO order dated March 31, 2020 exonerating the Noticee held erroneous as not in interest of securities market; Noticee held liable for price manipulation and misleading appearance of trading and penalty of INR 10,00,000 imposed under Section 15HA
Provisions invoked
- s. 15
- s. 19
- s. 12
- s. 15H
- s. 15J
- s. 23I
- s. 15T
- s. 36
Regulations relied on
- SEBI (PFUTP) Regulations, 2003 — 3(a)
- SEBI (PFUTP) Regulations, 2003 — 3(b)
- SEBI (PFUTP) Regulations, 2003 — 3(c)
- SEBI (PFUTP) Regulations, 2003 — 3(d)
- SEBI (PFUTP) Regulations, 2003 — 4(1)
- SEBI (PFUTP) Regulations, 2003 — 4(2)(a)
- SEBI (PFUTP) Regulations, 2003 — 4(2)(e)
Parties
- ARG Management Solutions Pvt. Ltd.
Holding
The Whole Time Member held the AO's exoneration of ARG Management Solutions Pvt. Ltd. erroneous and held that its 4000 single-share buy trades contributing INR 4,228.90 to positive LTP violated Section 12A(a),(b),(c) and Regulations 3(a)-(d), 4(1), 4(2)(a) and (e), warranting INR 10,00,000 penalty under Section 15HA.
Full text
Order against ARG Management Solutions Pvt. Ltd. in the matter of Nutraplus India Ltd. Page 1 of 11 WTM/ASB/IVD/ID16/19713/2022-23
Order against ARG Management Solutions Pvt. Ltd. in the matter of Nutraplus India Ltd. Page 2 of 11 had contributed to positive Last Traded Price (LTP) by INR 4,228.90 through those trades, which were 17.56% of the total contribution of INR 24,086.60 to the positive LTP during the period from January 01, 2015 to February 03, 2016 (price rise patch), thereby allegedly violating inter alia Regulations 3(a), (b), (c) & (d), 4(1) and 4(2) (a) & (e) of the PFUTP Regulations, 2003. (b) In view of the above, adjudication proceedings were initiated against the Noticee and other entities. Accordingly, a common show cause notice dated February 14, 2020 was issued by the AO to the Noticee and the said other entities for the abovementioned alleged violations. Subsequently, the AO passed the AO Order dated March 31, 2020 wherein the AO concluded that the charges against the Noticee, as mentioned in the show cause notice dated February 14, 2020, were not established. Consequently, the AO disposed of the show cause notice dated February 14, 2020 against the Noticee without any penalty. The AO had disposed of the abovementioned adjudication proceedings inter alia on the following grounds: (i) The net positive contribution to LTP by the Noticee was INR 2,798.20 only, since the Noticee also had a negative contribution of (-)INR 2,575.60 to the LTP in respect of 5,227 trades executed by it. (ii) In respect of the 4000 trades of 1 share each, the counterparties (639 in number) of the Noticee wer
Order against ARG Management Solutions Pvt. Ltd. in the matter of Nutraplus India Ltd. Page 3 of 11 an opportunity of personal hearing on July 07, 2022, which was attended by Noticee’s authorized representative, Mr. Ravi Ramaiya, through video conferencing. During the personal hearing, the authorized representative reiterated the submissions contained in Noticee’s reply dated May 19, 2020. The submissions of the Noticee, as contained in the said reply, are discussed later in this order. Consideration of issues:
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Source: SecMarx — sebi:WTM/ASB/IVD/ID16/19713/2022-23. 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.