sebi:WTM/RKA/ISD/135/2015
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Interim ex-parte directions confirmed and continued till further directions with limited supervised relaxations; prayer for setting aside/revocation rejected
Provisions invoked
- s. 11
- s. 11(4)
- s. 19
- s. 11(1)
Parties
- Shrenik Nalin Zaveri
Holding
The ad-interim ex-parte restraint on the Noticee from accessing the securities market and buying, selling or dealing in securities was confirmed and continued till further directions, subject to limited permission to deal in securities and mutual fund units under stock exchange supervision with proceeds in an interest-bearing escrow account.
Full text
Order in the matter of Mishka Finance and Trading Limited Page 2 of 11 Limited, (i.e. the preferential allotees), at an exorbitant premium of ₹75/- per share on September 24, 2012. d) Then, on February 06, 2013, Mishka announced bonus shares in the ratio of 7:1. As a result, the share capital of Mishka increased to 1,03,33,600 shares. e) Thereafter, suddenly trading started in the scrip of Mishka from February 14, 2013. In Patch 1, i.e. from February 14, 2013 to February 14, 2014, the price of the scrip gradually increased from ₹5.50/- to ₹499/- (unadjusted) and ₹49.90/- (adjusted) with very low volume. f) Prior to February 14, 2013, the entire share capital of Mishka was with Promoters, Promoter related entities and Preferential allotees. g) Once the price of the scrip increased exponentially, Mishka announced a stock-split in the ratio of 1:10 on January 16, 2014 to make a passage for preferential allotees to exit since the stock split would reduce the per share price and increase liquidity. h) One month after the stock split, i.e. from February 17, 2014 59 entities, connected / related, directly or indirectly, to Mishka, started providing hugely profitable exit to the preferential allotees and promoter related entities. i) The said price movement was not backed by fundamentals of Mishka and its financials.
Order in the matter of Mishka Finance and Trading Limited Page 3 of 11 hearing, the Noticee also filed his written submissions.The replies / written submissions of the Noticee are, inter alia, as under:
Order in the matter of Mishka Finance and Trading Limited Page 4 of 11 order or any connection / commonality between the Noticee and any other entity named in the Ex-parte Order as alleged in the Ex –Parte order. 11) He has prayed that the Ex-parte Order be revoked and set aside forthwith and all proceedings be dropped without any further directions. 12) Without prejudice to the above prayer, the Noticee has sought the following interim reliefs: a) to allow him to sell the shares and the units of Mutual Funds lying in the beneficiary accounts and to keep the such proceeds in an interest bearing escrow account; b) to allow the credit of shares based on any corporate actions and credit of units of growth schemes of Mutual Funds in his demat account; c) to allow the Portfolio Manager to actively manage his portfolio in line with PMS Regulation of SEBI as he is not directly involved in the management thereof.
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Source: SecMarx — sebi:WTM/RKA/ISD/135/2015. 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.