sebi:WTM/PS/54/IVD/ID-4/NOV/2010
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Facts / Headnote
Noticee restrained from buying, selling or dealing in securities market or accessing the securities market for six months
Provisions invoked
- s. 11B
- s. 19
Regulations
- Reg. 4
- Reg. 4(a)
Parties
- Stellar Fiscal Services Pvt. Limited
Holding
SEBI held Stellar Fiscal Services Pvt. Limited violated Regulation 4(a) of the PFUTP Regulations by supporting the price of ETC and restrained it from buying, selling or dealing in or accessing the securities market for six months.
Full text
Page 2 of 7 ETC had received funds from it. Noticee used the amount so received for making payments for its trade in the scrip of ETC.
Page 3 of 7 - Special power of attorney was given to Mr. Jogish Mehta only for the purpose of representing to the RoC for matters relating to company incorporation. - Strategy of the company was to create value by investing in the shares of other companies. - Stellar had advanced an Inter Corporate Deposit to ETC as it was facing liquidity crunch. - Had bought the shares of ETC as a long term investment strategy and the said shares were sold about 18 months after the date of purchase at a much lower price. - Receipt of `17,00,000 and `13,00,000 was the repayment of loan by ETC. Payment of `6,00,000 was constructive payment of loan by ETC to the broker on their behalf and instructions. - ETC is in the business of broadcasting and Stellar is in the business of investing in shares. ETC has not funded Stellar for any activities related to the investment of shares and the shares acquired by it were from their own funds. - About 9 years have passed since the shares were acquired and it is difficult to recollect the exact facts and circumstances under which the orders were executed.
Page 4 of 7 a. From the SCN and the statement of director of noticee, I note that the noticee and ETC were having close relationship at the relevant point of time. It has been argued that the promoters of noticee namely Mr. Jogish Mehta and Mr. Rakesh H. Dharawat became the auditor and Chief Financial Officer respectively of ETC pursuant to their exit as promoter of the noticee in the year as 1999-2000.
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Source: SecMarx — sebi:WTM/PS/54/IVD/ID-4/NOV/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.