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2020 (1) TMI 716 - AT - SEBISegregation of the funds and securities of client - Regulation Of Transactions Between Clients And Brokers - violation of SEBI circulars dated November 18, 1993 and August 27, 2003 - Penalty imposed - HELD THAT:- There is no violation of circular dated November 18, 1993. The circular itself, inter-alia, provides that withdrawal of money on client authority is permissible. In the present case, money was transferred from the client's accounts to his own account in the commodities market on client's letter of authority. This is against the guidelines provided in the circular dated November 18, 1993 itself, therefore, the order, to that extent is required to be set aside. Transactions allegedly carried out by the appellant contrary to the directions contained in SEBI circular No. MRD/SE/Cir-33/2003/27/08 of August 27, 2003 - The submission that the money was withdrawn from one account and credited to another account was on the strength of the letter of authority from the respective client cannot be accepted so far as the present circular is concerned. In our view, the appellant had committed breach of the directions contained in the said circular. Considering the fact that though none of the prescribed mode of cash transfer was adopted by the appellant as provided by the circular, nonetheless, there was no cash handling in any of the transactions. Considering all these facts on the record, in our view, a penalty of ₹ 5 lacs would be fair.
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