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2020 (2) TMI 1002 - SECURITIES APPELLATE TRIBUNAL, MUMBAIFraudulent and Unfair Trade Practices Relating to Securities Market - Creating artifice/scheme - appellant restrained from dealing in the securities market, directly or indirectly, for a period of five years from the date of the ad-interim ex-parte order - HELD THAT:- An unknown company suspended from trading for long; off-market buying of 1,050 shares of the said company which constitutes more than 2% of its share capital and which is in the name of an unknown person (Kushal Jain) on the recommendation of a person from the native place of the appellant with no prior connection etc. can be treated as only a fiction rather than normal business. Coupled with the finding that the appellant had other transactions off-market with Gromo as given in Table 2 page 13-14 of the impugned order is sufficient evidence to prove the connection between Gromo, the appellant and entities in the Kamalakshi Group, many of whom are inter connected in the matter as explained in the said table. Moreover, out of 1,050 shares of Gromo obtained off-market in an inexplicable way by the appellant more than half of it was sold in small tranches; most of the time placing sell order at far away prices than LTP. The said trading pattern and the other connections as explained above is sufficient enough to prove that the appellant was part of the group that created the artifice/scheme and therefore finding in the impugned order that the appellant has violated the stated provisions of the PFUTP Regulations cannot be faulted. Five year restraint imposed on the appellant has been in operation since February 20, 2015. However, the appellant never challenged the ex-parte interim order and filed this appeal belatedly with a delay of 101 days only on March 25, 2019 when there was hardly 1 year left to complete the restraint period. The orders relied on by the appellant are distinguishable in the facts of the present matter and in law since subsequent Judgements of the Hon'ble Supreme Court in the matter of Securities and Exchange Board of India v. Kishore R. Ajmera [2016 (2) TMI 723 - SUPREME COURT] and SEBI v. Rakhi Trading (P.) Ltd. [2018 (2) TMI 580 - SUPREME COURT] whereby it has been conclusively held that preponderance of probability is sufficient in confirming violations like market manipulation as direct evidence in such matters may not be forthcoming.
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