sebi:WTM/SR/EFD/61/09/2017
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Facts / Headnote
Avon Corporation Limited prohibited from accessing the capital market directly or indirectly and dealing in securities or instruments with Indian securities as underlying for a period of ten years from the date of the Order; Shri Pankaj Saraiya found to have violated Sections 12A(a)-(c) of the SEBI Act, Regulations 3(b)-(d) and 4(2)(c), 4(2)(f), 4(2)(k), 4(2)(r) of PFUTP Regulations 2003, and Section 11C(3) of the SEBI Act; SCN disposed of without further directions against Smt Rupal Pankaj Saraiya and Smt Shantaben Pratapsingh Saraiya; SCN disposed of against Shri Bhupendra Doshi, Shri Pratapsingh Kakubhai Saraiya, Shri Rakesh Chatrabhuj Dhagai and Smt Shilpa Rakesh Dhagai; proceedings against one entity abated; all entities warned to ensure future dealings comply with law.
Provisions invoked
- s. 11
- s. 19
- s. 12A
- s. 27
- s. 11C(3)
- s. 11C(5)
- s. 446
- s. 446(1)
- s. 77(2)
- s. 77(4)
- s. 633(2)
- s. 457
- s. 663(3)
Regulations
- Reg. 11
- Reg. 3(b)
- Reg. 4(2)(c)
- Reg. 11(1)
Parties
- Avon Corporation Limited
- Shri Pankaj Saraiya
- Smt Rupal Pankaj Saraiya
- Smt Shantaben Pratapsingh Saraiya
- Shri Bhupendra Doshi
- Shri Pratapsingh Kakubhai Saraiya
- Shri Rakesh Chatrabhuj Dhagai
- Smt Shilpa Rakesh Dhagai
Holding
Avon Corporation Limited and its Chairman/Managing Director Shri Pankaj Saraiya were held to have violated the SEBI Act and PFUTP Regulations, 2003 by executing a Pledge Agreement with Euram that effectively financed Vintage's subscription of Avon's own GDR Issue while falsely disclosing to BSE that foreign investors had subscribed, and by concealing material information from SEBI; Avon was prohibited from accessing the capital market for ten years. Proceedings against the remaining Directors and Promoters were disposed of for insufficient evidence of their control over Avon at the time of the GDR Issue.
Full text
Page 2 of 26 Show Cause Notice dated December 18, 2014 – 2.1 SEBI completed its investigation in the matter of alleged market manipulation using GDR Issues and based on the findings contained in the Investigation Report, a Show Cause Notice (“SCN”) dated December 18, 2014, was issued to the following entities, viz.
Page 3 of 26 iii. As the authorised signatory for Avon, Shri Pankaj Saraiya (Chairman, Managing Director, Chief Executive Officer and Promoter of Avon during GDR Issue in June 2009) signed a Pledge Agreement dated June 10, 2009, with European American Investment Bank AG (“Euram”) on June 12, 2009. Shri Pankaj Saraiya was also the authorised signatory for Avon’s bank account with Euram.
Page 4 of 26 April 13, 2012, Avon never received any machinery from Ababil as Avon did not require the aforesaid machinery.
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Source: SecMarx — sebi:WTM/SR/EFD/61/09/2017. 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.