In the matter of trading of shares at Magadh Stock Exchange and in respect of Mr. Ramod Kumar Agarwal(Huf) Ms. Sumitra Devi Agarwal and Mr. Rahul Kumar Agarwal

 

BEFORE THE ADJUDICATING OFFICER

SECURITIES AND EXCHANGE BOARD OF INDIA

[ADJUDICATION ORDER NO. AP/AO-32 /2006-07]

 

 

IN THE MATTER OF TRADING OF SHARES

AT MAGADH STOCK EXCHANGE  

 

AND

In respect of

Mr. Ramod Kumar Agarwal(HUF)

 

 

1.                  Bhoruka Financial Services Ltd. (hereinafter referred as ‘BFSL’) is an NBFC incorporated in 1971 and does not have any activity.  It held land admeasuring 15 acres at Whitefield Road, Bangalore, which it ‘purchased’ from its sick group company, Bhoruka Steel Ltd. (hereinafter referred to as ‘BSL’) in December 2002 at Rs. 4.21 crores. The land was registered in BFSL’s name in June 2004.  The promoters of BFSL wanted to sell off this land and DLF Commercial Developers Ltd. (hereinafter referred to as ‘DCDL’) was agreeable to the purchase.

 

2.                  BFSL scrip is listed only in the Bangalore Stock Exchange (hereinafter referred to as ‘BgSE’). However, it was ‘traded’ in Magadh Stock Exchange Association (hereinafter referred to as ‘MSEA’) under the ‘permitted category’ based on an application dated August 01, 2005 from Member Rajat Share and Stock Brokers Pvt Ltd. (hereinafter referred to as ‘Rajat’), who acted as broker to BFSL, DCDL and the Noticees. The promoters of BFSL held 198,850 shares in BFSL, constituting 98.73% of BFSL’s equity. The promoters of BSFL sold their entire holding in BFSL @ Rs. 4,490 per share, to DCDL.

 

3.                  The issue of Recognition to MSEA was under examination of SEBI. In this regard SEBI initiated the process of granting of renewal of the recognition to MSEA as a stock exchange, for a period of one year, ending December 10, 2005, vide Gazzette Notification No. SO1354(E) dated December 6, 2004. However, the renewal to MSEA was subject to it fulfilling certain conditions. MSEA forwarded its revised proposal to fulfill the aforesaid pre conditions, vide e-mail dated July 11, 2005, as its previous proposals were rejected by the Board for being incomplete. Even before the proposal was approved, trading started in MSEA during the period August 01, 2005 to August 12, 2005. Such trading took place in twenty scrips, aggregating to a value of Rs. 90.06 crores. Out of this, the traded value in the scrip of BFSL alone accounted for Rs. 89.28 crores i.e 99.13% of the traded value. The remaining 19 scrips were traded between just two members for their respective “clients” namely 1. Mr. Ramod Kumar Agarwal , 2. Ms. Sumitra Devi Agarwal & 3. Ms. Rahul Kumar Agarwal (hereinafter referred to as Noticee 1,2 & 3 respectively) . The value of such trades executed was 0.78 crores i.e 0.87% of the total value of trades executed between August 01, 2005 to August 12, 2005. Since MSEA did not have the statutory recognition as a stock exchange, it is alleged that the trades executed in MSEA during the aforesaid period were prohibited under section 19 of SCRA.

 

4.                  The Noticee 1 is the brother of Bimal Kumar Agarwal (hereinafter referred to as ‘Bimal’) who is a director of Rajat Share and Stock Brokers Pvt Ltd (hereinafter referred to as ‘Rajat’). Noticee 2&3 are spouse and son respectively of Noticee 1. The Officiating Executive Director (OED) of MSEA, O.M. Pandey is also alleged to be a part of the aforesaid irregularity as follows. For establishing the entire link, it may be noted here that Siddhartha Agarwal, promoter of BFSL approached Bimal, Director of Rajat and his cousin, in June 2005. Besides, Bimal was also a member of Council of Management (CoM) of MSEA (October 2004 - September 2005) and therefore aware that MSEA did not have the statutory recognition as a Stock exchange. Nevertheless, Bimal sought permission from OED of MSEA to sell and buy BSFL shares on behalf of his clients vide letters dated 18^th and 25^th July 2005 respectively. On July 27, 2005 OED of MSEA issued a ‘notification’ that trading in MSEA would commence shortly, without mentioning any date. This ‘notification’ was faxed to the Siddhartha the same day and on July 28, 2005 the sellers and DCDL entered a share purchase agreement (SPA) for transacting in BFSL shares at MSEA through Rajat. Accordingly, the sellers transferred the first lot of demat shares to Rajat’s account and on August 01, 2005, DCDL transferred corresponding funds to Rajat’s account. Rajat applied to OED on August 01, 2005 to permit trading in the scrip of BSFL in MSEA. It is alleged that at the instance of OED, permission was granted on the same day to trade BSFL scrip in MSEA under the ‘permitted category’. Accordingly, the ‘transactions’ in the scrip of BFSL were ‘executed’ at MSEA by member Rajat.

 

5.                  In the light of the links aforesaid and trading of scrip of BFSL in MSEA, it is alleged that the Noticees deliberately traded in the scrips as detailed in this order. It was alleged that such trades were artificial in nature and were primarily done to create a false and misleading appearance of trading in MSEA and with a larger vision of providing authenticity to the illegal trades in BFSL.

 

6.                  Accordingly, the undersigned was appointed as Adjudicating Officer under Section 15 I of SEBI Act, 1992, read with Rule 3 of SEBI (Procedure For Holding Inquiry And Imposing Penalties By Adjudicating Officer) Rules, 1995  vide SEBI order dated September 20, 2006 to inquire into and adjudge under Section 15HA of the Securities and Exchange Board of India Act, 1992, for the role of noticees violation of Regulation 4(2)(a) of SEBI(Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market),Regulations, 2003(hereinafter referred to as ‘PFUTP’).

 

7.                  Show Cause Notices (SCNs) all dated November 16, 2006 were issued to the noticees mentioned below in terms of Rule 4(1) of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995, communicating the charges.

 

 

8.                  The SCNs alleged that noticees transacted in 19 scrips in MSEA through member Rajat, though the said scrips were not listed in MSEA. Of the said 19 scrips, only Kamat Hotel and Mawana Sugar had ‘permission ‘ to trade in MSEA under the Permitted Category. It was also alleged that the aforesaid transactions were not genuine as the trades were reversed between MSEA members Rajat Share and Stock Brokers Pvt. Ltd. (Rajat) and Jhunjhunwala Binod & Co (JB), ‘on behalf’ of their respective clients. The former traded on behalf of the noticees and also for its proprietary account and the latter purportedly traded on behalf his ‘client’, Gopal Sharma. Since all the transactions were squared off, the net position in the 19 scrips, except ACC, was nil.  The details of the trades executed by the  Noticees  are as follows :

 

Sl. No	Scrip	Buying Broker	Buying Client	No. of shares	Selling Broker	Selling Client	No. of Shares
1	ACC	JJ Binod & Co.	Gopal Kumar	250	Rajat	Prop	125
		Rajat	Prop	125	Rajat	Ramod Agarwal & Family	100
		Rajat	Ramod Agarwal & Family	125	JJ Binod & Co	Gopal Kumar	-250
2	BANK OF INDIA	JJ Binod & Co	Gopal Kumar	200	Rajat	Prop	200
		Rajat	Prop	200	JJ Binod & Co.	Gopal Kumar	200
3	Bhoruka Gas	JJ Binod & Co	Gopal Kumar	8000	Rajat	Ramod Agarwal & Family	8000
		Rajat	Ramod Agarwal & Family	8000	JJ Binod & Co	Gopal Kumar	8000
4	Bhuwalka Steel	JJ Binod & Co	Gopal Kumar	7500	Rajat	Ramod Agarwal & Family	7500
		Rajat	Ramod Agarwal & Family	7500	JJ Binod & Co.	Gopal Kumar	7500
5	CHAMBAL FERT	JJ Binod & Co.	Gopal Kumar	1100	Rajat	Prop	800
		Rajat	Prop	800	Rajat	Ramod Agarwal & Family	300
		Rajat	Ramod Agarwal & Family	300	JJ Binod & Co.	Gopal Kumar	1100
6	CSS INFOTECH	JJ Binod & Co	Gopal Kumar	10500	Rajat	Ramod Agarwal & Family	10500
		Rajat	Ramod Agarwal & Family	10500	JJ Binod & Co	Gopal Kumar	10500
7	ESSAR GUJARAT	JJ Binod & Co	Gopal Kumar	2500	Rajat	Ramod Agarwal & Family	2500
		Rajat	Ramod Agarwal & Family	2500	JJ Binod & Co	Gopal Kumar	2500
8	G V Film	JJ Binod & Co	Gopal Kumar	85000	Rajat	Ramod Agarwal & Family	85000
		Rajat	Ramod Agarwal & Family	85000	JJ Binod & Co	Gopal Kumar	85000
9	GUJ HEAVY CHEMICAL	JJ Binod & Co	Gopal Kumar	4000	Rajat	Ramod Agarwal & Family	4000
		Rajat	Ramod Agarwal & Family	4000	JJ Binod & Co	Gopal Kumar	4000
10	HIND LIVER	JJ Binod & Co	Gopal Kumar	300	Rajat	Prop	100
		Rajat	Prop	100	JJ Binod & Co	Gopal Kumar	300
		Rajat	Ramod Agarwal & Family	150	Rajat	Ramod Agarwal & Family	150
11	HMT LTD	JJ Binod & Co	Gopal Kumar	5500	Rajat	Ramod Agarwal & Family	5500
		Rajat	Ramod Agarwal & Family	5500	JJ Binod & Co	Gopal Kumar	5500
12	ICICI BANK	JJ Binod & Co	Gopal Kumar	25	Rajat	Prop	25
		Rajat	Prop	25	JJ Binod & Co	Gopal Kumar	25
13	KAMAT HOTEL	JJ Binod & Co	Gopal Kumar	4000	Rajat	Ramod Agarwal & Family	4000
		Rajat	Ramod Agarwal & Family	4000	JJ Binod & Co	Gopal Kumar	4000
14	MAWAN SUGAR	JJ Binod & Co	Gopal Kumar	5000	Rajat	Ramod Agarwal & Family	5000
		Rajat	Ramod Agarwal & Family	4000	JJ Binod & Co	Gopal Kumar	4000
15	MRPL	JJ Binod & Co	Gopal Kumar	300	Rajat	Ramod Agarwal & Family	300
		Rajat	Ramod Agarwal & Family	300	JJ Binod & Co	Gopal Kumar	300
16	RCFT	JJ Binod & Co	Gopal Kumar	1600	Rajat	Ramod Agarwal & Family	1600
		Rajat	Ramod Agarwal & Family	1600	JJ Binod & Co	Gopal Kumar	1600
17	RELIANCE IND	JJ Binod & Co	Gopal Kumar	50	Rajat	Prop	50
		Rajat	Prop	50	JJ Binod & Co	Gopal Kumar	50
18	SAH PETRO	JJ Binod & Co	Gopal Kumar	5000	Rajat	Ramod Agarwal & Family	5000
		Rajat	Ramod Agarwal & Family	5000	JJ Binod & Co	Gopal Kumar	5000
19	SSI	JJ Binod & Co	Gopal Kumar	1500	Rajat	Ramod Agarwal & Family	1500
		Rajat	Ramod Agarwal & Family	1500	JJ Binod & Co	Gopal Kumar	1500

 

 

9.                  Further, in light of the aforesaid it was alleged that dealing of the noticees in securities which were never listed nor allowed to be traded on MSEA, is fraudulent and was unfair trade practice as it involved fraud.

 

10.              The Noticees were advised to show cause as to why an inquiry should not be held against them in terms of Rule 4 (3) of the captioned Rules r/w section 15I of SEBI Act, 1992 and were provided 14 days from the date of receipt of the said notice to reply to the same.

 

11.               The Noticees filed their respective replies, identically worded vide letters dated January 3, 2007. It was submitted that regarding notification issued by SEBI granting the renewal of recognition to MSEA, they are unable to throw any light as they were not a party of the said renewal and were not aware of any such notification at the time of placing orders for the trades. It is also stated that they have no knowledge with regard to the official gazette issued by SEBI about the renewal of recognition of MSEA. Further, their involvement were in the transactions amounting to only 0.87% of the total traded value in MSEA, which in any way is not the quantum or the quantity or value that can have any impact or bearing on the trading pattern or the price mechanism of any stock exchange and therefore can not be termed as instrumental to any manipulation of any kind. The noticees have also submitted that they traded in MSEA primarily because the Brokerage was lesser than that charged by the Bombay Brokers. Further Bombay Brokers were not interested in intraday trading. The noticees submitted that they need to place the orders for the trades to be executed on the Stock Exchange, without specifying the Stock Exchange, and they were under the impression that their trades will be executed by Rajat on Interconnected Stock Exchange of India (ICSE) through the subsidiary of MSEA.  It was only after receipt of the valid contract notes from the broker they came to know that MSEA is functional and the trades were executed as per the SEBI/MSEA bye laws. Under the circumstances namely having contract notes, the trades being executed on the platform of the exchange and the payments been duly made or received, there could not have been any iota of doubt about genuineness of the trades is also submitted by the Noticees.

 

12.               It is also submitted by the Noticees that the observation alleging that the trades being reversed is devoid of facts, because the trades were not reversed rather they were genuine intraday day trades which were carried out after payment of brokerage, STT and Service Tax as applicable. Further, the allegation that the trades were done to give authenticity to the illegal trades of BFSL/DFL does not stand valid as they are in no way connected directly or indirectly or had any knowledge of any such trades and that the allegation of having violated Regulation 4 (2) (a) of PFUTP Regulation is unfounded and based on conjectures and surmises and that none of their actions have infringed or violated the factors set out in Section 15J of the SEBI Act, 1992.

 

13.              Under the aforesaid circumstances, the undersigned thought it fit to hold an inquiry in the matter. Accordingly, vide letter dated January 15, 2007 notices of inquiry were issued to noticees as under :

 

Sl. No.	Name of Noticee	Date of inquiry	Remark Inquiry post-poned to 06.02.2007 at the request of the noticees
1.	Mr.Ramod Kumar Agarwal	25.01.2007
2.	Ms. Sumitra Devi Agarwal	25.01.2007
3.	Mr. Rahul Kumar Agarwal	25.01.2007

 

14.              The hearing was attended by Mr. Prakash Shah, Chartered Accountant collectively on behalf of the Noticees. The Noticee no. 1 was also present during the inquiry. The submissions were made by the Noticees and the submissions made vide their replies dated 03.1.2007 were re-iterated for the inquiry. I now proceed to deal with the charges and the submissions of the noticees and proceed to record my findings as below :

 

15.               I observe that with regard to SEBI Notification for renewal of recognition to MSEA the Noticees have taken a plea that they were not aware of any such notification at the time of placing orders for the trades. In context to their plea, I firmly believe that from the date of publication of the Notification in the Official Gazette, the notification becomes effective and law of the land. Further, it is an established judicial principle that Ignorance of law can never lawfully be pleaded as defence to any offence or violation and neither it absolves the Noticees from their violation. Similarly, in the instant matter also I am afraid that such a plea of the Noticees will not come to their rescue. Further, it should also be pointed out that subsequent to the notification being published in Official Gazette, it is presumed that the Noticees were well aware of the same and such an presumption is not fallacious because all market players need to be aware of the happenings in their respective fields of operation.

 

16.              It is contended by the Noticees that they were involved in transactions which amounted to only 0.87% of the total traded value in MSEA and hence such a small quantum cannot be attributed to or instrumental in any manipulation. In this regard I observe that it is trivial on my part to adjudge the violation by looking at the quantum of trade. The broader picture is the role played by this small quantum (only in % terms) of Trade and finally evolving as a significant parameter which definitely is instrumental in the whole manipulative process. My aforesaid statement is strongly tied with my conviction that the small quantum was an important catalyst which helped in successful completion of the larger conspiracy amounting to Rs. 89.28 crores. Moreso, it is also prudent to note here that the trading in the scrips by the Noticees during August 01, 2005 to August 12, 2005(which they claim to have a small quantum) was illegal because of the very fact that MSEA was not having a statutory recognition as a Stock Exchange. The whole manipulative process was well structured and well planned and trading in 19 Scrips by the noticees was an important element which helped to materialize the ulterior design.

 

17.               In the entire episode, it can be vociferously established that there was a nexus observed between the Broker, client and promoter of BFSL. The association of this nature rules out any element of subjectivity in the whole ulterior process and indicates that the entities were hands in gloves in the whole manipulative process. I will not resign without summarizing the nexus involved :

 

                                I.      Noticee No. 1 is the elder brother of Bimal Kumar Agarwal who is one of the directors of Rajat Shares and Stock Brokers Pvt Ltd, the broker who executed the trading in 19 scrips on behalf of the Noticees. Further, Bimal Kumar Agarwal was also a member in the council of Management of MSEA. Noticee 2&3 are wife and son respectively of Noticee 1.

                             II.      Shri. S.N.Agarwal who is one of the promoters of BFSL, is married to the sister-in-law of Shyam Sunder Banka, who in turn is the maternal uncle of Noticee 1. Consequently, Noticee 1 and Shri. S. N. Agarwal are also related to each other.

 

18.              The observed nexus of the broker, client (Noticees) and the promoter of BFSL is a defining line, having outmost importance in the whole conspiracy and the events that transpired at MSEA. It shall be noted that no rational person will buy Noticees argument that their broker, who being a member of the Council of Management of MSEA was not aware of the ongoing irregularities in MSEA and did not inform his elder brother i.e Noticee 1 that the trades were being executed in the platform of MSEA. Even if we see the happenings independent of the relationship between the broker and the client then too there is no iota of doubt that client is unaware of the moves of the broker primarily because keeping a track of brokers decision is the basic strategy of the clients trading in securities market. Moreso, it becomes a necessity on part of the clients as their money is at stake.  It is also unacceptable that noticees had gone to MSEA to trade in ICSE, because contract notes were being issued to the noticees by the broker on a continuous basis thereby establishing the place of trading for the entire period of trading spanning 12 days.

 

19.              Further, in the instant matter I observe that shares worth 78 Lakhs were traded between the period August 1, 2005 to August 12, 2005. The majority of the transactions in the 19 scrips were in the nature of square –off transactions and at the end of each trading day the net position in the scrips was nil. This signifies that such nature of trading is usually done by intraday traders with a vision of short term investment accruing short term gains. However it is on record that the normal behaviour of the Noticee is of a long term investor who usually traded in BSE through another broker. In light of which I am unable to attribute any rationality in the whole sequence of events and trading by Noticee’s in MSEA and that too for a stipulated period which is not in tune with their normal trading behaviour. What I can attribute is connivance of the broker, Noticee’s and people in the internal administration of MSEA, exploiting the shambolic and dismal state of affairs at MSEA for their unlawful gain and with a larger vision to provide substance and authenticity to trades of BFSL. Further, such an advanced stage of reversal of trades for 12 consecutive days elude genuineness in the whole scheme of events.

 

20.              The final issue before me is to constructively establish that the trading by the Noticees in the 19 scrips duly cascades under the realm of Fraudulent and Unfair Trade Practices and what I have alleged against the Noticees is not merely preponderance of probability. I have meticulously observed from the facts on records that for majority of the trades the counter party broker and the counter party client were identical indicating that the trades executed were well planned and well structured resulting in advanced stage of reversal of trade leading to net position of nil at the end of the day. The structure of trades which were ongoing for 12 consecutive days is purely synchronized and coupled with reversal. Such a design of trade for 12 consecutive days cannot be devoid of connivance.

 

21.               It is a settled position now that synchronized trades per se are not illegal unless they are manipulative or otherwise declared as fraudulent. In order that a person/broker is made liable for the manipulative synchronized trades, the Hon'ble SAT has laid down certain criteria in number of its orders. One of the case I discuss is as under:

 

 

“Nirmal Bang Securities Pvt. Ltd (SAT-Appeal no. 54-57/2001)” –In the said Order the Hon’ble SAT has enumerated the basis for establishing the charge of matched trades viz., complete matching of order time, order quantity and order rate over a period of time. Drawing from the said wording from SAT, the trading pattern in the instant matter satisfied the following points in order to prove the trade as synchronized:

a)      too many matched trades over a period of 12 consecutive days,

b)     over too long a period i.e lasted concurrently with the entire period of larger violation/conspiracy.

c)      too many transactions when both the parties enter buy and sell orders for the same quantity of shares at the same order price,

d)     orders placed simultaneously so as to leave no chance for any third party to intervene

e)      nexus between the parities either by way of any connections or way of meeting of minds.

 

22.              In light of the aforesaid it is evident and can be established that the trading by the Noticees over a period of 12 days was with a larger vision to dilute the effect of the illegal trading in the scrip of BFSL. This could not have been possible without connivance of the broker, Noticees and people in the internal administration of MSEA.

 

23.              From the aforesaid findings and material on record signifying the synchronized trades, the intention of the Noticees is self evident and the charge that they indulged in generating artificial volumes, through synchronized trades gets established. With the benefit of further examination of data, it is now confirmed that all the aforesaid entities generated artificial volumes, which have been through synchronized/reversal of trades in the period of the investigation. Such pattern of trade is prohibited under Regulation 4 (2)(a) of PFUTP Regulations, 2003, which inter-alia provides as under:

 

SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market), Regulations, 2003

4. Prohibition of manipulative, fraudulent and unfair trade practices

(2) Dealing in securities shall be deemed to be fraudulent or an unfair trade practice if it involves fraud and may include all or any of the following namely :-

(a) indulging in an act which creates false or misleading appearance of trading in the securities market ;

 

 

24                In terms of the aforesaid provision it is observed that dealing in securities shall be deemed to be fraudulent or an unfair trade practice in the following circumstances:

 

i.        if it involves fraud, and /or

ii.      it is an act which creates false, misleading appearance of trading in the securities market.

 

25.              In order to satisfy the above conditions, I need to examine whether the act of the noticees involves fraud. In this regard I refer to the definition of “fraud”, as provided under Regulation 2(1) (c) (6) of PFUTP which provides that the word fraud would include “any such act or omissions as any other law specifically declares to be fraudulent”. In this case noticees have been found indulging in an act which has created false or misleading appearance of trading in the securities market, which is specifically declared to be fraudulent and unfair trade practice in terms of the provision of Regulation 4(2) (a) of PFUTP Regulation. It is therefore established that the noticees have violated the provision of regulation 4(2) (a) of PFUTP Regulation. The said violation attracts penalty in terms of Section 15HA of SEBI Act, 1992 which reads as under:

Provisions of 15HA of SEBI Act, 1992

"15HA. If any person indulges in fraudulent and unfair trade practices relating to securities, he shall be liable to a penalty of twenty-five crore rupees or three times the amount of profits made

26.              To determine the quantum of penalty under Section 15HA, the undersigned considered the following factors as provided in the section 15J of SEBI Act, 1992 viz. (a) the amount of disproportionate gain or unfair advantage, wherever quantifiable, made as a result of the default; (b) the amount of loss caused to an investor or group of investors as a result of the default and; (c) the repetitive nature of the default. It is now established that trading pattern of Noticee 1 for himself and on behalf of Noticee 2 and 3 are violative of Regulation 4(2)(a). The value of the shares that were traded through synchronization may be used to ascertain the amount involved as a result of default by the noticees. In the instant matter I observe that shares worth 78 Lakhs were traded between the period August 1, 2005 to August 12, 2005 by the noticees. This amount however does not reflect about the undue gains made by the noticees as a result of default. In my view the role of the noticees needs to be seen in the light of larger conspiracy whereby the shares of BFSL worth Rs. 90 Crores were traded illegally and noticees played an important and active role in seeing the conspiracy through. It is also observed that the conduct of the Noticees have been repetitive and lasted exactly within the period of larger conspiracy. The violation therefore needs to be viewed seriously especially when the noticees have created false and misleading appearances of trading at MSEA to regularise trading in the shares of BFSL. The said conduct of the noticees provide enough evidence rendering them guilty of trading involving fraud and unfair trade practices.  

 

27.              The level of integrity from the participants is expected to be of a higher order while trading. However in the instant matter there was a high degree of collusion among many market participants including noticees which is established above. Therefore, I am of the considered view that these entities who perpetuated the fraud and created artificial volumes should meet with a deterrent penalty.

 

28.              Therefore, in exercise of the powers conferred under section 15-I (2) of the SEBI Act, 1992, read with Rule 5 of SEBI Adjudication Rules, I hereby impose a penalty of Rs. 25,00,000/- (Rupees. 25 Lakhs) collectively on the Noticee’s as detailed aforesaid under section 15HA of SEBI Act, 1992. The Noticees are liable to pay penalty jointly and in case of default, the Noticees shall be liable severally.

 

29.              The aforesaid entities shall pay the said amount of penalty by way of demand draft in favour of “SEBI- Penalties Remittable to Government of India”, payable at Mumbai within 45 days of receipt of this order. The said demand draft should be forwarded to Shri Sanjeev Dutt, Chief General Manager – Investigation Department (ID-5), SEBI Bhavan, C4-A,”G” Block , Bandra Kurla Complex, Bandra ( East), Mumbai 400 051.

 

30.              This order of adjudication is made and passed on 29^th  day of March 2007 at Mumbai.

 

AMIT PRADHAN