9911796707
TMI Blog2013 (12) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... ank - No evidence of the payment has been shown by the appellant - No document is brought on record to substantiate the story regarding the payment for these 20,000 shares. the appellant had kept the shares of the company in fact in his demat account without any transaction whatsoever in the said shares which were stated to be pledged for the loan in question - The role of the appellant was confined to extending loan facility to MK and no more - He was not found to have been engaged at all in any dealing in the shares of the ASL in any manner - He had no role in the circular/manipulative trades highlighted by the learned WTM in the impugned order for the simple reason that he did not trade in the shares - The role of the appellant in tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that he was holding 20,000 shares of Alka Securities Limited (ASL) i.e. the company in question in physical form. He requested his depository (DP) for dematerialization on May 31, 2008 and the said shares were credited to his demat account on June 20, 2008. In September 2008, Dena Bank initiated some recovery proceedings against the defaulting company i.e. ASL. Accordingly, Dena Bank made an offer to sell certain quantity of shares of ASL as part and parcel of their recovery process. The applicant also applied for acquiring 20,000 shares alongwith a pay order of Rs. 32,000 at the rate of Rs. 1.60 per share on October 3, 2008. Pursuant thereto, Dena Bank, by way of an off market transfer, transferred said 20,000 shares of ASL through an Inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ASL in his demat account no. 1204470000013256, which had been transferred to his said demat account form the demat account no. IN30038610193653 of a promoter, Ms. Dimple M. Kothari. The appellant is alleged to have received shares form the promoters without consideration, and after having received the transfer of shares from the promoter had further transferred the same to entities which were identified as persons who had manipulated the price and volume of shares of ASL. However, the appellant denied the allegations contained therein. The impugned order dated May 11, 2012 came to be passed against the applicant and some other persons after completing legal formalities as required by law. 7. The case of the appellant is that he is an inno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were responsible alongwith others in manipulating the price and volume of the shares of ASL on the BSE. It is pertinent to note that the said two purchasers have neither given any reply to the SCN nor have they availed of the opportunity of personal hearing or put up any defence to the charge of manipulation. The impugned order, therefore, confirms the sale by the appellant of the said shares to the said two purchasers. It is, as such, submitted by SEBI that the charge against the appellant of his being a conduit for transfer of shares from the promoters to the persons held to be manipulating the price of the shares of ASL stands proved. 10. We have heard Shri Vinay Chauhan, learned counsel for the appellant and Shri Kumar Desai with Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation 3, no person shall indulge in a fraudulent or an unfair trade practice in securities. (2) Dealing in securities shall be deemed to be a 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; (b) dealing in a security not intended to effect transfer of beneficial ownership but intended to operate only as a device to inflate, depress or cause fluctuations in the price of such security for wrongful gain or avoidance of loss; (c) advancing or agreeing to advance any money to any person thereby inducing any other person to offer to buy any security i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubstantiate the story regarding the payment for these 20,000 shares. On the contrary, it is noted that the said quantity of 20,000 shares was transferred from the account of one Dimple M. Kothari, who is admittedly one of the promoters, to the account of the appellant on January 19, 2009. This undeniably falsifies the contention of the appellant that he purchased the said shares in an open auction from Dena Bank. The appeal is, therefore, bereft of any merit and is liable to be dismissed on this ground alone. 12. The Respondent also pointed out that the market price of shares of ASL on October 3, 2008 was Rs. 23.04/- per share and Dena Bank had the option of off-loading the shares of ASL, held by them, on this date in the market itself at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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