sebi:WTM/MPB/EFD-1-DRA-IV/67/2018
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Facts / Headnote
Directions issued: disgorgement of ₹34,74,722 with 12% interest, seven-year trading ban, and asset restraint
Provisions invoked
- s. 19
- s. 12A
- s. 307
- s. 28A
Regulations
- Reg. 3
- Reg. 2
- Reg. 3(i)
- Reg. 4
- Reg. 2(c)
- Reg. 2(e)
- Reg. 12(2)
- Reg. 12A(d)
- Reg. 12A
Parties
- Mr. Abhishek Mehta
Holding
The Noticee, Mr. Abhishek Mehta, as Managing Director of Acclaim Industries Limited, violated insider trading provisions by selling 7,44,918 shares while in possession of unpublished price sensitive information regarding the cancellation of the proposed merger with Database Software Technology Private Limited, and is liable to disgorge ill-gotten gains of ₹34,74,722 with interest and a seven-year market ban.
Full text
Order in the matter of Acclaim Industries Limited Page 2 of 18 2. Mr. Karsan K. Chitroda Director 3. Mr. Pandurang Nawghane Director (Independent) 4. Mr. Krishnat Desai Director (Independent)
Order in the matter of Acclaim Industries Limited Page 3 of 18 and thus in violation of provisions of Securities and Exchange Board of India, Act 1992 (hereinafter referred to as the ‘SEBI Act’) and PIT Regulations, during the investigation period. SHOW CAUSE NOTICE
Order in the matter of Acclaim Industries Limited Page 4 of 18 of amalgamation. Subsequently, on August 17, 2012, the company has informed BSE that due to unavoidable circumstances, the company has decided to postpone the Board Meeting to be held on August 17, 2012 to August 30, 2012. The outcome of the Board meeting held on August 30, 2012 was informed by the company to BSE on September 6, 2012, wherein it was inter alia informed that the merger of the company for finalizing the share exchange ratio and scheme of amalgamation has been postponed, and that the company shall consider the matter in the next Board Meeting. The company vide its undated letter, received in SEBI on November 02, 2015 stated that - The next board meeting held on 18th February, 2012 for finalizing the share exchange ratio but it was unanimously decided by the Board of Directors of the Company not to merge M/s Acclaim Industries Ltd with Database Software Technology Private Ltd due to some management issues /technical issues. The company did not submit outcome of Board meeting dated February 18, 2012. This was inadvertent mistake on the part of the management of the company. It may be noted that the even though the Board of Directors had cancelled the proposed merger in its meeting dated February 18, 2012 and even failed to inform the Exchange regarding the same, the company continued with its announcements regarding mergers’ share exchange ratio and scheme of amalgamation. From the above sequen
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Source: SecMarx — sebi:WTM/MPB/EFD-1-DRA-IV/67/2018. 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.