sebi:WTM/RKA/ISD/31/2015
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Facts / Headnote
Interim directions restraining First Financial Services Limited from accessing securities market confirmed pending investigation; company permitted to liquidate shares in demat/margin account in orderly manner under exchange supervision with sale proceeds kept in separate escrow account not to be utilised till investigation complete; request to use proceeds to clear broker debit balance rejected and request to lift trading suspension not dealt as not subject matter of interim order.
Provisions invoked
- s. 11
- s. 19
- s. 11(4)
- s. 11B
- s. 81
- s. 12(3)
Parties
- First Financial Services Limited
Holding
The Whole Time Member confirmed the interim order restraining First Financial Services Limited from accessing and dealing in the securities market pending investigation, while permitting orderly liquidation of its share portfolio under exchange supervision with proceeds in escrow.
Full text
Order in respect of First Financial Services Limited Page 2 of 31 (hereinafter referred to as “interim order”), restrained the company along with other 151 entities, (hereinafter referred to as "Noticees"), from accessing the securities market and further prohibited them from buying, selling or dealing in securities in any manner whatsoever, till further directions.
Order in respect of First Financial Services Limited Page 3 of 31 company had no role to play in the trading done by various entities/persons as mentioned in the interim order. There were no corporate announcements (save and except routine announcements) made by the company, which is normally resorted to in order to influence the price of the scrip. At no point of time either the stock exchange or SEBI had raised any alarm bells as to price movement in the scrip not being in consonance with its financials or fundamentals despite the price of the scrip rising sharply as alleged. Therefore, for the price rise in the scrip consequent to trading by others, with whom the company is not connected or related, no adverse inferences can be drawn against the company.
Order in respect of First Financial Services Limited Page 4 of 31 Venkata Maistry Street, Mannady, Chennai - 60000l has been taken on rent from the director of the company viz. Mr. V. S. Sudhakar who is also running his own company (Carewell Enterprises) from part of the said premises. Further no employees were allegedly found at the said registered office as all the operations of the company are handled at corporate office at Mumbai. It is error on the part of BSE to conduct inspection of premises at 1513 and 1514, Maker Chamber V, 221, Nariman Point, Mumbai - 400 021 when vide letters dated November 02, 2014 and November 04, 2014, the company had already informed BSE to that its corporate office had shifted from the said address of Nariman point to A-109, First Floor, Sanpada Railway Station complex, Sanpada, Navi Mumbai – 400705. This has lead to incorrect observations and distorted conclusions being drawn against the company in the interim order.
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Source: SecMarx — sebi:WTM/RKA/ISD/31/2015. 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.