sebi:WTM/KMA/IVD/146/10/2009
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Facts / Headnote
Restrained Universal Media Network Limited, Mr. Siddhartha Srivastava, Mr. Ashok Kumar Mishra, Mr. Manish Pardiwala, Mr. Paresh Shantilal Shah, Mr. P.R. Parasuram, Galaxy Television Limited, MBS Investments & Trading Private Limited and SGP Investments Private Limited from accessing the securities market and prohibited from buying, selling or otherwise dealing or associating with the securities market in any manner whatsoever for a period of two years, with immediate effect.
Provisions invoked
- s. 19
Regulations
- Reg. 11
- Reg. 3
Parties
- Universal Media Network Limited
- Mr. Siddhartha Srivastava
- Mr. Ashok Kumar Mishra
- Mr. Manish Pardiwala
- Mr. Paresh Shantilal Shah
- Mr. P.R. Parasuram
- Galaxy Television Limited
- MBS Investments & Trading Private Limited
- SGP Investments Private Limited
Holding
The company and its four directors violated Regulations 3, 4(b), 5(1)(a) and (b) and 6(a) of the PFUTP Regulations by publishing misleading bonus-issue advertisements, and Mr. Siddhartha Srivastava with Galaxy Television Limited, MBS Investments & Trading Private Limited and SGP Investments Private Limited violated Regulations 3, 4(b) and 6(a) by offloading shares through the artificially created market; all were debarred for two years.
Full text
Page 2 of 19 M/s. Garima Communications, Ahmedabad. One such company which had issued similar advertisements in the newspapers during the relevant period was Universal Media Network Limited (hereinafter referred to as the company). The shares of the company were listed at the Bombay Stock Exchange Limited (hereinafter referred to as BSE), the Ahmedabad Stock Exchange Limited (hereinafter referred to as ASE), the Calcutta Stock Exchange Association Limited (hereinafter referred to as CSE) and the Jaipur Stock Exchange Limited (hereinafter referred to as JSE). SEBI noticed that the company had issued advertisements in leading newspapers during last week of June 2002, giving notice that “a meeting of the Board of Directors of the Company is scheduled to be held on the 4th day of July, 2002 at the registered office inter alia to take on record consideration of bonus shares.” The company had intimated the same to BSE, ASE, CSE and JSE on June 27, 2002. It was found that the first advertisement dated June 24, 2002 was published on June 27, 2002 in the daily, “The Economic Times”. Similar advertisements were also issued in Gujarat Samachar (on June 28, 2002), Mumbai Samachar (on June 28, 2002) and Investor Guide (on July 01, 2002) and that the total cost of issuance of all the advertisements was approximately Rs. 2.5 lakhs. It prima facie appeared to SEBI, that the advertisements were issued to attract investor interest in the shares of the company and to induce them to trade in the
Page 3 of 19 board meeting to be held on July 04, 2002, inter alia, to consider the allotment of bonus shares; b. the advertisements were made in the absence of any legal requirement on the part of the company and that such advertisements were published when the company was incurring losses and also when it was not declaring dividends; c. the advertisements and the contents therein were published on unsubstantiated and intangible premise and that there never was any intention to proceed with the bonus issue and that the advertisements were published only with a view to create investor interest in the shares of the company; d. Mr. Ashok Kumar Mishra, Mr. Paresh Shantilal Shah, Mr. Manish Pardiwala and Mr. P.R. Parasuram were the directors of the company during the relevant period; e. entities/individuals related to the promoter group and their associates namely Galaxy Television Limited, SGP Investments Private Limited, MBS Investments and Trading Private Limited etc., had offloaded a total of 1,38,21,517 shares of the company during the relevant period. Mr. Siddhartha Srivastava was a promoter/controlling shareholder in Galaxy Television Limited and also in the company. He was also the director/authorized signatory for SGP Investments Private Limited and MBS Investments and Trading Private Limited; f. some of the transferees had offloaded substantial shares of the company in the market pursuant to the said advertisements, thereby making unfair gains; g. there was an increase
Page 4 of 19 Securities Market) Regulations, 1995 (hereinafter referred to as the PFUTP Regulations). Subsequently, show cause notices dated December 02, 2004 were issued by SEBI, inter alia to the company, its directors (namely Mr. Ashok Kumar Mishra, Mr. Paresh Shantilal Shah, Mr. Manish Pardiwala and Mr. P R Parasuram), Mr. Siddhartha Srivastava, promoter related entities i.e. MBS Investments & Trading Private Limited, S G P Investments Private Limited and Galaxy Television Limited, requiring them to show cause as to why suitable
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Source: SecMarx — sebi:WTM/KMA/IVD/146/10/2009. 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.