sebi:WTM/MPB/EFD1-DRA4/30/2019

SEBI · SEBI · 2017-07-28 · Madhabi Puri Buch, Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Noticee restrained from accessing the securities market for four years and prohibited from buying, selling or otherwise dealing in securities, directly or indirectly, or being associated with the securities market in any manner for four years from the date of the order; existing holdings frozen during the period of restraint.

Provisions invoked

• s. 11
• s. 19
• s. 12

Regulations

• Reg. 4
• Reg. 2(c)
• Reg. 3
• Reg. 4(1)
• Reg. 3(a)
• Reg. 2(b)

Parties

• Ms. Anjana Arun Karwa

Holding

The Noticee, Ms. Anjana Arun Karwa, was held to have manipulated the price of the scrip of Shree Shaleen Textiles Limited (SSTL) by executing 11 sell trades over the LTP in miniscule quantities during March 2012 to March 2013, in violation of Regulations 3(a), (b), (c), (d) and 4(1), 4(2)(a), (e) of the PFUTP Regulations. She was restrained from accessing the securities market and from dealing in securities for a period of four years.

Full text

Order in the matter of Shree Shaleen Textiles Limited Page 2 of 16 entities in the scrip of SSTL during the period period November 01, 2011 to November 30, 2014 (hereinafter referred to as “Investigation Period”).

Order in the matter of Shree Shaleen Textiles Limited Page 3 of 16 SHOW CAUSE NOTICE 5. Consequent to the investigation, a show cause notice dated July 28, 2017 (hereinafter referred to as “SCN”) was served on Ms. Anjana Arun Karwa (hereinafter referred to as “Noticee”) in the extant matter. The SCN inter alia alleged as follows: a) The LTP analysis of the 4 patches was done and the details of Patch 2 qua the Noticees is given below: LTP Analysis: Patch-2: Post Bonus – Price Rise Period – 30/03/2012 to 05/03/2013:  During this period, the price of the scrip rose from ` 4 (Opening Price) as on March 30, 2012 to ` 111.85 (High Price and Close Price) as on March 05, 2013. Further, with ex-date of March 06, 2013, SSTL sub-divided the face value of shares from ` 10/- to ` 2/. The list of shareholders received from RTI (Purva Sharegistry (I) Pvt Ltd.) was analyzed and it was observed that as on March 31, 2012, 85.34% of the share capital (5,76,050 shares out of 6,75,000 shares) were held in physical form or with entities which had converted warrants (shares issued on conversion of warrants were under lock-in till November 14, 2012). The top 10 net LTP sellers’ analysis were carried out as under:

Order in the matter of Shree Shaleen Textiles Limited Page 4 of 16  From the above table, it can be observed that top 10 net LTP sellers contributed to 90.57% of market positive LTP.  In view of the low volume price increase and substantial positive LTP contribution (90.57% of market positive LTP) by top 10 net LTP contributors, as sellers, sell orders of the top 10 net sell LTP contributors contributing more than 5% of the positive LTP in more than one trade were analyzed and the trades of the Noticee are as under:

Source: SecMarx — sebi:WTM/MPB/EFD1-DRA4/30/2019. 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.