TMI Blog2011 (6) TMI 942X X X X Extracts X X X X X X X X Extracts X X X X ..... er dated January 14, 2011 passed by the whole time member of the Board suspending its certificate of registration as a stockbroker for a period of three weeks from the date of the order. 2. The Board carried out investigations in the scrip of DSQ Biotech Ltd. (hereinafter called the company) and it transpired that, among others, the appellant had traded in the scrip on behalf of its clients including Nirjay Securities Pvt. Ltd. (Nirjay) and that while trading on behalf of this client the appellant had aided and abetted the client in influencing the price of the scrip and also created artificial volumes by indulging in fictitious deals/trades without intending to transfer the beneficial interest in the traded security. The appellant is, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the appellant had executed a fictitious trade which raised the price of the scrip upwards and thereby violated the aforesaid provisions. There were two other similar trades executed by the appellant on behalf of Nirjay where the latter was both the buyer and the seller. It was also found that in settlement no. 27, the appellant purchased on September 26, 2000 shares of the company on behalf of Khandwala Securities Ltd. which is an associate of the appellant and the counter party broker was Prabhudas Liladhar who sold the shares on behalf of DSQ Holdings Ltd. which is the holding company of the company whose shares were being manipulated. Another finding recorded in the enquiry report is that the appellant executed matched trades in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctitious because no person can buy from himself and/or sell to himself. Mr. Zal Andhyarujina learned counsel for the appellant very strenuously urged before us that the appellant did not commit any wrong while executing the trades on behalf of Nirjay which was a day trader. He further pointed out that the appellant executed large number of trades on September 14, 2000 on behalf of Nirjay and other clients which have not been found fault with and that even with the three trades referred to by the enquiry officer, it was the system which matched the buy and sell orders of Nirjay and that there was no synchronization or intention to match those orders. We are unable to accept this contention. It is by now well understood that the buy and sell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jay then placed a buy order for 50,000 shares at 14:27:59 hours at the rate of ₹ 197/- per share. It is pertinent to mention that on the trading screen what the broker can see before placing any buy/sell order are five best buy orders and five best sell orders. Having seen those orders and knowing that the trades were being executed at a price less than ₹ 194/- a buy order was put in at the rate of ₹ 197/- which matched with the sell order pending earlier which had been put in by the appellant on behalf of Nirjay. It is, thus, clear that Nirjay was buying shares at 14:27:59 hours and, therefore, its attempt ought to have been to purchase them at the lowest available price in the system. Instead, it went on to purchase shar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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