sebi:WTM/GA/MRD/DSA/890/05
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Facts / Headnote
Interim ex-parte directions issued: MSEA restrained from assisting/regulating dealings in securities; trading in BFSL scrip suspended; promoters directed to deposit proceeds in escrow account; BFSL shares impounded at CDSL; broker directed not to deal in securities; officiating ED suspended.
Provisions invoked
- s. 11B
- s. 11
- s. 11(4)
- s. 19
- s. 10
- s. 12
Regulations
- Reg. 14
- Reg. 4(2)
- Reg. 4
- Reg. 199
Parties
- Magadh Stock Exchange (MSEA)
- 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.
- Rajat Share & Stock Brokers Pvt. Ltd.
- Shri C M Pandey
Holding
MSEA's conditional renewal of recognition was deemed not to have been renewed due to non-compliance with conditions precedent, rendering MSEA an unrecognized stock exchange whose trades in BFSL cannot be construed as transactions on a recognized stock exchange. Interim directions were issued suspending trading in BFSL, impounding shares and proceeds, and restraining MSEA, the broker, and the officiating ED.
Full text
vide Notification no. SO 899(E) dated December 05, 1986 for a period of 5 years commencing on December 11, 1986. The recognition was subsequently renewed from time to time under Rule 7 of Securities Contracts (Regulation) Rules, 1957.
from 11th day of December 2004 and ending on 10th day of December 2005 subject to the conditions stated below: (i) The Exchange shall set up Settlement Guarantee Fund in compliance with SEBI Circular SMD/POLICY/SUB BROKER /Cir-12/97 dated June 09, 1997, after final approval by SEBI. (ii) Trading shall commence only after setting up of Settlement Guarantee Fund, duly approved by SEBI. (iii) The Exchange shall repay the balance amount of RS 7, 50,000/-(Seven Lakhs fifty thousand only) towards refundable financial support extended by SEBI to the Exchange.
started on August 1, 2005. To all intents and purposes, MSEA appears to have commenced trading without complying with the conditions mentioned supra.
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Source: SecMarx — sebi:WTM/GA/MRD/DSA/890/05. 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.