sebi:WTM/TCN/49/IVD-1/Sept/08

SEBI · SEBI · 1995-11-09 · Dr. T.C. Nair, Whole Time Member

Reviewed by Varun Matlani, Advocate — Securities Lawyer practicing in SAT and SEBI

Facts / Headnote

Restrained the noticees from accessing the securities market and from buying, selling or dealing in securities for a period of six months.

Provisions invoked

Regulations relied on

Holding

The noticees were found to have violated Regulation 4(a) to (e) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to the Securities Market) Regulations, 1995 by acting in concert to artificially create volume and inflate the price of SPML shares prior to its rights issue, and were restrained from accessing the securities market for six months. No violation of the Takeover Regulations was found.

Full text

2 1.1 M/s. Subhash Projects & Marketing Limited (hereinafter referred to as SPML) is a listed company which was incorporated as a private limited company on August 27, 1981 and later became a public limited company on August 27, 1983.

3 through many brokers and had traded in the shares of SPML pursuant to an oral understanding/arrangement with Shri Subash Chand Sethi, Vice Chairman and Managing Director of SPML. Raj Investment had undertaken the entire exercise with a view to increase and maintain the price of SPML shares in the market and creating artificial volume and trading in the scrip of SPML.

4 2.2 In the meantime, during a routine monitoring of the price and volume movement of the scrip of SPML, it was noted that there was a sudden increase in the price and volumes in this scrip on the NSE during the period July 14, 1999 to October 26, 1999 (hereinafter referred to as investigation period II) and that Raj Inv and associates continued to trade in the scrip of SPML and their gross trading volume was found to be around 3.82 lacs shares which amounted to nearly 11.90% of the total trading volume at the NSE. It was further noted that:

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Source: SecMarx — sebi:WTM/TCN/49/IVD-1/Sept/08. 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.