sebi:WTM/TCN/123/IVD3/Jan/2009
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Facts / Headnote
Censure imposed on M/s. V & U Securities Pvt. Ltd. (erstwhile M/s. Kirtikumar Kantilal Shah), member of Ahmedabad Stock Exchange, SEBI registration no. INB 021105730; the Enquiry Officer's recommended 20-day suspension of certificate of registration was held excessive.
Provisions invoked
- s. 19
- s. 12
Regulations
- Reg. 7
- Reg. 13(2)
- Reg. 4(b)
- Reg. 28(2)
Parties
- M/s. Kirtikumar Kantilal Shah (erstwhile), now M/s. V & U Securities Pvt. Ltd.
Holding
KKS (now V & U Securities Pvt. Ltd.) was found guilty of acting as an unregistered sub-broker of M P Vora (BSE member) in violation of Section 12 of the SEBI Act, 1992 and SEBI circulars dated March 31, 1997 and January 16, 1998, and of violating the Code of Conduct for stock brokers read with Schedule II of Regulation 7 of the Broker Regulations. The recommended 20-day suspension was held excessive and a penalty of Censure was imposed instead.
Full text
2 4. M/s. Kirtikumar Kantilal Shah (hereinafter referred to as “KKS”), member of ASE was alleged to have acted as a unregistered sub broker of M P Vora Shares & Securities Pvt. Ltd., member, BSE. It was further alleged that KKS while trading in the shares of OTPL on behalf of Coverage and Consultants Ltd. (CCL) aided and abetted in offloading unlisted shares of OTPL, thereby violating the provisions of Regulation 4(b) and (d) of SEBI(Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995. It was also alleged that the broker had violated the provisions of Clause A(2) of Code of Conduct of Stock Brokers read with Schedule II of Regulation 7 of the SEBI(Stock Brokers and Sub Brokers) Regulations, 1992 (hereinafter referred to as “Broker Regulations”).
3 attended the hearing and made submissions. Since KKS had not replied to the show cause notice, seven days time was given to KKS to submit his reply to the show cause notice. Accordingly, vide letter dated July 31, 2008, KKS submitted its reply to the show cause notice. It is noted that the reply was received from V & U Securities Pvt. Ltd. with the signature of KKS as the Chairman & Managing Director. When confirmed about this fact, it was found that KKS was registered as a member of ASE on December 2, 1992 as an individual trading member. Later he converted his membership to corporate entity in the name of V & U Securities Pvt. Ltd. on May 31, 2000. The reply of the KKS is an under:
4 delivered the listed shares of OTPL and not a single unlisted share of OTPL has been introduced by them in the market.
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Source: SecMarx — sebi:WTM/TCN/123/IVD3/Jan/2009. 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.