sebi:WTM/VKC/ID6/27/07

SEBI · SEBI · 2001-02-23 · V. K. CHOPRA, WHOLE TIME MEMBER

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Facts / Headnote

Minor penalty of 'censure' imposed on the Noticees for technical violation of delayed transfer of securities; charges of price manipulation and artificial market under PFUTP Regulations and Stock Brokers Regulations not sustained.

Provisions invoked

• s. 19

Regulations

• Reg. 13(4)
• Reg. 6
• Reg. 4(a)
• Reg. 7
• Reg. 13(1)
• Reg. 13(5)

Parties

• M/s Damani Shares & Stock Brokers Pvt. Ltd.
• M/s Maheshwari Equity Brokers Pvt. Ltd.
• M/s Avenue Stock Brokers (I) Pvt. Ltd.

Holding

The Noticees were found not to have violated the PFUTP Regulations or the Code of Conduct for Stock Brokers, but were found to have committed a technical violation of delayed transfer of securities from the broker's pool account to the client's beneficiary account, for which a minor penalty of 'censure' was imposed.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ Order in the matter of RS Damani Group Jan 02, 2007 | Orders : Orders of Chairman/Members BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA CORAM : V. K. CHOPRA, WHOLE TIME MEMBER In the matter of R. S. Damani Group

4.0 CONSIDERATION OF ISSUES & FINDINGS 4.1 I have carefully examined the Enquiry Report, Show Cause Notices, Replies of the Noticees and submissions made at the time of hearing and proceed to deal with the same as 4.2 The charges levelled against the Noticees are under the provisions of Regulations 4(a) & (b) of the PFUTP Regulations, Regulation 7 read with clause A (3), (4) and (5) of the Conduct for Stock Brokers under Stock brokers Regulations and Rules, Regulations and Bye-laws of Stock Exchange. The Enquiry Officer held that the Noticees have not the above Regulations and suggested warning for the delay in transfer of securities from the brokers pool account to the beneficiary account. This was however not acce the Board. Three separate Show Cause Notices were issued to each of the Noticees and the same were replied by them. 4.3 The said Show Cause Notices were issued to the Noticees in terms of Regulation 13(5) of the Enquiry Regulations as a pre-condition to impose higher penalty. The Coun appeared on behalf of Noticees raised a preliminary objection of maintainability of the impugned Show Cause Notices on the ground that the same failed to prov justification for proposing higher penalty. In this regard, I have perused the Show Cause Notices and find that reasons had been given in it. 4.4 The Enquiry Officer has examined the charge of concentrated delivery based sale in the scrip of Infosys allegedly committed by the Noticees on February 23, 2001 and March 0 and conseq

1.3 The Board, after considering the Interim Investigation Report, appointed an Enquiry Officer vide Order dated September 17, 2001 to conduct enquiry in respect of the violations allegedly committed by the Noticees under the provisions of Regulations 4(a) & (b) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995, (hereinafter referred to in short as “PFUTP Regulations”), Regulation 7 read with clause A(3), (4) and (5) of the Code of Conduct for Stock Brokers under SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 (hereinafter referred to in short as “Stock brokers Regulations”) and Rules, Regulations and Bye-laws of Stock Exchange. 1.4 The Enquiry Officer had conducted an enquiry in accordance with the provisions of Regulation 6 of the Securities and Exchange Board of India (Procedure for holding Enquiry by Enquiry Officer and imposing penalty) Regulations, 2002 (hereinafter referred to as “the Enquiry Regulations”) and submitted a report dated April 08, 2002 under Regulation 13(1) of the Enquiry Regulations. The Enquiry Officer in his report recommended that a warning may be issued to the Noticees for the delay in transfer of securities from the brokers pool account to the beneficiary account. 2.0 SHOW CAUSE NOTICE 2.1 The Board disagreed with the above findings of the Enquiry Officer and considered the matter for imposing a higher

Source: SecMarx — sebi:WTM/VKC/ID6/27/07. 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.