sebi:WTM/RKA/IVD/133/2014

SEBI · SEBI · 2014-01-10 · Rajeev Kumar Agarwal, Whole Time Member

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Facts / Headnote

Noticee found to have contravened PFUTP Regulations; prohibited from buying, selling or otherwise dealing in securities for one year

Provisions invoked

• s. 19

Regulations

• Reg. 11
• Reg. 3
• Reg. 3(a)

Parties

• Mr. Prashant Kamble

Holding

The noticee, Mr. Prashant Kamble, was found to have contravened regulations 3(a), (b), (c), (d) and 4(1), 4(2)(a) and (g) of the PFUTP Regulations, 2003 by indulging in 189 self-trades of 75,725 shares across 21 scrips without intention of change of beneficial ownership, and was prohibited from buying, selling or otherwise dealing in securities for a period of one year.

Full text

Order in respect of tradings by Mr. Prashant Kamble Page 2 of 7 4 Gandhinagar Hotels Ltd. 2,56,336 2,43,764 15,473 31 5 G.S. Auto International Ltd. 15,77,830 15,77,630 12,403 29 6 SKS Logistics Ltd. 8,48,154 8,31,923 8,741 31 7 Gokul Refoils and Solvent Limited 23,705 23,705 650 1 8 Softech Infinium Solutions Limited 1,74,700 2,73,700 1,200 6 9 Kanani Industries Ltd. 96,823 96,681 1,016 7 10 Arihant Capital Markets Ltd. 13,566 13,566 911 3 11 Marg Ltd. 16,279 16,279 289 1 12 Gujarat Metallic Coal & Coke Ltd. 10,33,051 10,33,051 459 19 13 Syncom Formulations (I) Ltd. 45,196 45,196 187 1 14 Interworld Digital Ltd. 14,31,549 14,31,464 95 3 15 Panchsheel Organic Ltd. 42,587 42,587 80 2 16 Indiaco Ventures Ltd. 443 443 11 3 17 Meuse Kara & Sungrace Mafatlal Ltd. 98,003 55,943 10 1 18 Swasti Vinayaka Synthetics Ltd. 8,21,460 8,21,379 10 1 19 Shalibhadra Finance Ltd. 78,083 78,083 10 1 20 Beckons Industries Ltd. 86,103 86,103 5 1 21 Sacheta Metals Ltd. 75,001 67,951 1 1

Order in respect of tradings by Mr. Prashant Kamble Page 3 of 7 3. Based on these facts, a Show Cause Notice (hereinafter referred to as ‘SCN’) dated January 10, 2014 was issued to the noticee alleging inter alia that the noticee allegedly executed 189 such self- trades in 21 scrips accounting for 75,725 shares to provide a false and misleading appearance of trading in the said scrip and thereby contravened the provisions of regulations 3(a),(b),(c),(d), 4(1), 4(2) (a) and (g) of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (the PFUTP Regulations) by the noticee. The provisions of the regulations alleged to be contravened by the noticee are reproduced hereunder:

Order in respect of tradings by Mr. Prashant Kamble Page 4 of 7 (b) SEBI did not provide copies of BSE and NSE reports in this regard. (c) SEBI has provided the noticee only the extracts of the trade and order logs containing its trades only. In the absence of the complete trade and order log it is erroneous to conclude that the trades of the noticee were deliberately matched with each other. (d) The noticee had traded in 89 scrips during the Investigation Period which stretches over almost 2 years. However, only 189 trades in 21 scrips are self-trades which clearly shows that the said alleged self-trades are mere coincidence and are on account of the automatic and anonymous order matching system of the stock exchange. (e) SEBI did not provide the noticee any data to show that the said alleged self-trades led to creation of artificial volume in the scrips or that the same was done with the intention to create artificial volume in the scrip. In this regard, the noticee has relied upon certain observations in the extracts of the investigation report. (f) The investigation by SEBI, BSE and NSE did not conclude that the noticee’s trades had created an artificial market or created a false or misleading appearance of trading. (g) The fact that the a particular trade was a self-trade, i.e., that the noticee’s buy and sell orders in a particular scrip matched against its own orders is not known to it or to the market. It is only known to the stock exchange/SEBI. (h) The noticee is a

Source: SecMarx — sebi:WTM/RKA/IVD/133/2014. 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.