TaxTMI 
TaxTMI 
2015 (10) TMI 1717
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....with Clause A(2) of the Code of Conduct as prescribed under Schedule II, Regulation 15 of Securities and Exchange Board of India (Stock Brokers and Sub-Brokers) Regulations, 1992 (for short "Stock Brokers and Sub-Brokers Regulations, 1992"). 2. Briefly stated the facts of the case are that the Appellant namely, Master Share & Stock Brokers Ltd., is a sub-broker registered with SEBI. Appellant is a sub-broker of M/s. LSE Securities Ltd. which happens to be a subsidiary of Ludhiana Stock Exchange Ltd. SEBI conducted an investigation on 7th/8th August, 2012 of various book of accounts, records and other documents maintained as furnished by the Appellant in respect of its affairs. It was found that the Appellant had not taken due care and skil....
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....s at length and perused the pleadings and provisions of law in detail. Para 2 of the said Circular makes it abundantly clear that the trading terminals granted to the stockbrokers cannot be misutilized for unregistered sub-broking activities. The trading terminals are only to be granted at the members' registered office, branch office or its registered sub-brokers' offices. Therefore, terminals granted at other locations than the prescribed ones in the circular would be totally illegal. The underlying idea seems to be to have proper control over the terminals for regulation purposes and it should be within the knowledge of the Stock Exchange as well as SEBI that the terminals are being run at the office of the broker or its branch office or....
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.... Brokers and Sub- Brokers Regulations, 1992. Shri Kumar Desai, learned counsel for the Respondent also brought to our notice Circular No.163 dated 20th April, 2000 issued by the National Stock Exchange Limited to all the members. Para 2 of the said circular categorically provides that the trading terminals shall be required to be under the direct control of the trading member and be managed either by an authorized employee or by a registered sub-broker of the trading member. In the present case, admittedly, the 4 terminals at 3 locations in dispute were managed by a consultants/persons engaged on contract basis and not by authorized employee or by the sub-broker himself. 7. Turning to the point urged by Shri Prakash Shah that the penalty i....