sebi:WTM/KMA/IVD/297/09/2010
Facts / Headnote
Show cause notices dated August 23, 2004 issued to Har Sai Investments Limited and RRB Securities Limited in the matter of VXL Instruments Limited disposed of without any directions
Provisions invoked
- s. 19
Regulations relied on
- SEBI (PFUTP) Regulations, 2003 — 11
- SEBI (PFUTP) Regulations, 2003 — 13
- SEBI (PFUTP) Regulations, 2003 — 4(b)
Parties
- Har Sai Investments Limited
- RRB Securities Limited
Holding
The show cause notices dated August 23, 2004 against Har Sai Investments Limited and RRB Securities Limited for alleged contravention of Regulation 4(b) of the PFUTP Regulations in trading in VXL Instruments Limited were disposed of without any directions, with both entities given the benefit of doubt.
Full text
Page 2 of 12 referred to as NSE). It was alleged that HSIL had purchased and sold around 4,20,000 & 4,65,400 shares of VXL through the stock broker, HB Securities Limited at NSE during the investigation period. HSIL, as a seller, was alleged to have entered into seven instances of structured/matched transactions involving 10,844 shares wherein the counter party buyer was RRB, through the stock broker, Fincap Portfolio Limited. It was also alleged that, HSIL had purchased 11,600 shares through HB Securities Limited and the counter party seller was HB Stockholding Limited through the stock broker, Fincap Portfolio Limited. HSIL (as a seller) was also alleged to have involved in a cross deal in respect of 34,400 shares and that the said trade was executed through HB Securities Limited wherein the counter party client was UTI Securities Exchange Limited. It was also mentioned that RRB had traded through the stock brokers, HB Securities Limited, Rosy Blue Securities Private Limited and Fincap Portfolio Limited during the investigation period. The transactions of RRB, as mentioned in the show cause notice are given below:
Page 3 of 12 3. Thereafter, the entities had made requests for various documents and subsequently, an opportunity of hearing was also afforded to them before my predecessor on July 10, 2006. The entities had again requested for the documents, vide letter dated July 6, 2006 and stated that they were not in a position to deal with the issues raised in the show cause notice and respond to them adequately in the absence of such documents. Another opportunity of hearing was granted to the entities on November 21, 2008 which was adjourned to December 11, 2008, on their request. Subsequently, an opportunity was given on January 30, 2009 pursuant to providing the documents. However, the entities requested for an adjournment of the said hearing so as to enable them to prepare their submissions. Accordingly, the said hearing was postponed to March 6, 2009. On the said date, Mr. H.S. Chandoke, advocate, as authorized by HSIL made elaborate submissions before me. Mr. Abdulla Hussain, advocate was also present during the hearing. RRB was represented by its director, Mr. Anil Goyal who made submissions on its behalf. The representatives made their submissions on the lines of the respective replies of the entities dated March 6, 2009, filed during the course of the hearing. As the entities had been issued show cause notices by SEBI in certain other matters where the period of the alleged violations was more or less the same as that of the present matter, it was thought fit in the interest o
Page 4 of 12 reports submitted by NSE for different periods covering the entire investigation period. The observation of NSE for the relevant periods as stated in the show cause notices are reproduced below:
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Source: SecMarx — sebi:WTM/KMA/IVD/297/09/2010. 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.