Disposal of representation of Mr Anurag Khandelia in the matter of First Financial Services Ltd

1. Securities and Exchange Board of India ("SEBI"), vide an ad interim ex-parte order dated December 19, 2014 (hereinafter referred to as “interim order”), restrained 152 entities, including Ms. Manju Khandelia, from accessing the securities market and further prohibited them from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, till further directions. Thereafter, SEBI vide its order dated August 25, 2016 inter-alia confirmed the interim directions qua Ms. Manju Khandelia along with others. 2. Vide letters dated August 19, 2016 and September 20, 2016, Mr. Anurag Khandelia had made, inter-alia, the following representations:

(a). On account of the restraining order against his mother, Ms. Manju Khandelia vide interim order dated December 19, 2014, two of his demat accounts (IN301549-32790904 and IN301127-15159182) held jointly with his mother i.e Ms. Manju Khandelia were frozen. (b). The demat account number IN301549-32790904 is held with HDFC Bank whereas demat account number IN301127-15159182 is held with Stock Holding Corporation of India Ltd (SHCIL). (c). He is the first holder in the aforementioned two demat accounts whereas Ms. Manju Khandelia is the second holder. Further there are no securities held in the demat account number IN301549-32790904 with HDFC Bank. (d). He is a professionally qualified chartered Accountant and working in the corporate sector having independent source of income. (e). He takes his own investment decisions and uses his own funds for doing any investments in the securities market. (f). As a result of the freeze, he is unable to deal in the securities market and losing out of the opportunities. (g). In view of the above submissions, he has requested that his demat accounts be unfreezed. 3. In support of his aforesaid claims, Mr. Anurag Khandelia has submitted the following documents:

Disposal of the representations of Shri Anurag Khandelia (a). Income tax return and computation of total income for assessment year 2014-15, 2015-16 and 2016-17. (b). Balance sheet including list of shares held as on March 31, 2014, March 31, 2015 and March 31, 2016 duly certified by Chartered Accountant. (c). Certificates by Chartered Accountant certifying that investment in shares shown in his balance sheets have been acquired by him from his own source of income. (d). Bank statements of Mr. Anurag Khandelia for the period 2014-15 to 2015-16. (e). Broker Ledger statement for the trading account of Mr. Anurag Khandelia. (f). Holding statement for the demat account with SHCIL.

4. I note that Mr. Anurag Khandelia has not been restrained by the aforesaid interim order. He is not holding any shares of First Financial Services Limited in his aforementioned demat accounts. 5. From the documents submitted by Mr. Anurag Khandelia, I note that : (a). Mr. Anurag Khandelia is the first holder and Ms. Manju Khandelia is the second holder of the two demats accounts viz IN301549-32790904 and IN301127-15159182 held with depository participants namely HDFC Bank and SHCIL respectively. (b). There are no securities lying in the demat account IN301549-32790904 whereas securities worth of ₹7 crore approximately are lying in demat account IN301127- 15159182 (c). He has filed his Income tax return in the assessment year 2104-15, 2015-16 and 2016- 17 towards his total income computed. (d). Chartered Accountant has certified that shares shown in the Balance sheet of Mr. Anurag Khandelia as on March 31, 2014, March 31, 2015 and March31, 2016 has been acquired by him from his own source of income. (e). He did not hold any shares of First Financial Services Limited as on March 31, 2015. 6. From the above it is noted that the investments in the securities lying in the demat account number IN301127-15159182 were made by Mr. Anurag Khandelia from his own source of funds and he holds rights and interests in those securities. 7. Considering the aforesaid submissions and evidences brought on record, I am of the view that the balance of convenience is in favour of Mr. Anurag Khandelia. Accordingly, I allow Mr. Anurag Khandelia to transfer the securities from the demat account number IN301127- 15159182 held jointly with his mother Ms. Manju Khandelia with Depository participant SHCIL to another demat account exclusively held by him in his individual name.

8. The aforesaid shall be subject to the supervision of stock exchanges and depositories and shall be without prejudice to the findings of pending investigation in the matter.

Sd/-

DATE: OCTOBER 18, 2016 RAJEEV KUMAR AGARWAL PLACE: MUMBAI WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA