TMI Blog2006 (2) TMI 686X X X X Extracts X X X X X X X X Extracts X X X X ..... ure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (hereinafter called the Regulations ). 2. The appellant is a broker registered with the Board. Investigations were conducted into the trading of the shares of Kwality Dairy (India) Limited (for short the Company ) to find out whether any provisions of the Securities and Exchange Board of India Act, 1992 or the Regulations framed thereunder had been violated. Investigations revealed that large number of shares were traded during the period from April 23 to June 6, 2004 and that the appellant allegedly indulged in circular trading. The precise charge leveled against the appellant as noticed in the impugned order is as under: 4.3 It was alleged that duri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ok into the matter who issued notices to all the three brokers including the appellant. It may be mentioned that against the other two brokers as well the charge leveled was the same. The enquiry officer after completing the enquiry submitted his report absolving Samani and Bonanza from the charges holding that there was no material to indicate that any one of them had any connection with any of the other brokers whereas in the case of the appellant he found that he matched trades with the other two brokers and was guilty of having indulged in circular trades resulting in artificial creation of volumes. On receipt of the enquiry report the Board issued a show cause notice to the appellant and the other two brokers. A copy of the enquiry rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quiry Officer that these continuous transactions should have alerted the broker and to this extent there was lack of due diligence on the part of the broker. 4. Accordingly by order dated 01/02/2006 the Board suspended the certificate of registration of the appellant for a period of 15 days. Hence this appeal. 5. We have heard the learned counsel for the parties and perused the orders passed by the Board in the case of all the three brokers including the appellant. It is common case of the parties that the charges leveled against all the three brokers were that they had joined hands together and indulged in circular trading in the scrips of the company thereby creating artificial volumes. It is really surprising to note that in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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