sebi:WTM/GA/MRD/DSA/890/
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Facts / Headnote
Interim ex-parte directions issued: MSEA restrained from assisting/regulating dealings in securities; trading in BFSL scrip suspended; BFSL shares impounded at CDSL; promoters directed to deposit proceeds in escrow account; OED of MSEA suspended; broker directed not to deal in securities.
Provisions invoked
- s. 11B
- s. 11
- s. 11(4)
- s. 19
- s. 10
- s. 12
Regulations
- Reg. 4(2)
- Reg. 4
- Reg. 199
- Reg. 14
Parties
- Madras Stock Exchange Association (MSEA)
- Rajat Share & Stock Brokers Pvt. Ltd.
- DLF Commercial Developers Limited
- Shri Satyanarayan Agarwal
- Shri Viveek Agrawal
- Umah Agrawal
- Siddhartha Agrawal
- Satyanarayanan Vivek Kumar HUF
- M/s Prabhu Securities Limited
- M/s. Bhoruka Engineering Ind. Ltd.
- Shri C M Pandey
Holding
SEBI held that MSEA acted as an unrecognized stock exchange by permitting trading in BFSL in violation of the conditions of its conditional renewal, and issued interim ex-parte directions suspending trading in BFSL, impounding the shares held at CDSL, restraining MSEA from dealing in securities, suspending its Officiating Executive Director, and directing the promoters to deposit transaction proceeds in an escrow account.
Full text
December 06, 2004 and subsequent SEBI’s directions. 8. It is observed from the trading volume of MSEA that Exchange had witnessed “NIL” trading in financial year 2004-05 and had negligible trading volum of Rs.13.26 lakhs in year 2003-04, Rs 18.27 lakhs in 2002-03 and only Rs1.12 lakhs in 2001-02. It is further observed that though MSEA had “N volume in 2004-05 and negligible volume in earlier years, there was a unusually high trading volume of approximately Rs 109.71 crores in just 10 tradi days in August 2005 since the commencement of trading by MSEA in violation of the conditions of renewal as already stated. Further, it is also observ that MSEA had the highest trading volume of Rs. 39.31 crores on August 12, 2005 alone.
meeting of the council was held on April 12, 2005, while the subsequent meeting was held on August 12, 2005 to take a decision to stop trading directed by SEBI.
28. Since it is prima facie found that the member of the MSEA namely Rajat Share & Stock Brokers Pvt. Ltd. facilitated the above transactions illegally the stock exchange and without following Know Your Client criteria, they are directed not to deal in securities. undertake any transactions in securities a broker registered with SEBI .
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Source: SecMarx — sebi:WTM/GA/MRD/DSA/890/. 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.