M/S. Rajnandi Yarns Pvt. Ltd. vs Sebi

Date of decision: 08/03/2016

Appeal No.409 of 2014

Santosh Vishram Ghadshi R.No.3, Nanasmruti, Telkush Wadi Old, Near Achala Society, Dombivali (W), Thane - 421 202. ...Appellant

Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No.C-4A, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ... Respondent

WITH Appeal No.410 of 2014

Kaushik Rajnikant Mehta 149/4086, Saidham Co-op. Society, New Pant Nagar, V.B. Lane, Ghatkopar (East), Mumbai - 400 075. ...Appellant

Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No.C-4A, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ... Respondent -2-

WITH Appeal No.453 of 2014

Narendra Prabodh Ganatra B/36, Kumar Co-op. Hsg. Scy., Behind R.C. Church, Vikhroli Station Road, Vikhroli (West), Mumbai - 400 079. ...Appellant Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No.C-4A, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ... Respondent

WITH Appeal No.14 of 2015

Shri Vasudev Ramchandra Kamat Flat No.14, 6th Floor, Dhanvantari Bldg-2, J.J. Hospital Campus, Byculla, Mumbai - 400 008. ...Appellant

Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No.C-4A, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ... Respondent

WITH Appeal No.192 of 2015

Manish Suresh Joshi 1/1229/3190, Tagore Nagar, Vikhroli (East), Mumbai - 400 083. ...Appellant

Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No.C-4A, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ... Respondent -3-

WITH Appeal No.111 of 2015

M/s. Rajnandi Yarns Pvt. Ltd. Swiss Celina, Halia Bhatia, Mahajan Wadi, Shop No.9, Kolbhat Lane, Mumbai - 400 002. ...Appellant

Versus

Securities & Exchange Board of India SEBI Bhavan, Plot No.C-4A, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051. ... Respondent

Dr. S.K. Jain, PCS for Appellants.

Mr. Kumar Desai a/w Mr. Mihir Mody, Mr. Harekrishna Ashar, and Mr. Saurabh Bachhawat, Advocates i/b K. Ashar & Co. for the Respondent.

CORAM : Justice J.P. Devadhar, Presiding Officer Jog Singh, Member

Per : Justice J.P. Devadhar (Oral)

1.

In all these Appeals, the Appellants are aggrieved by the common

order passed by the Adjudicating Officer ("AO" for short) of Securities and

Exchange Board of India ("SEBI" for short), dated 26th September, 2014

whereby penalty of Rs.5 lakh is imposed on each of the Appellants under

Section 15HA of the Securities and Exchange Board of India Act, 1992 ("SEBI

Act" for short) for the alleged violation of regulation 3(a), (b), (c), (d), 4(1) and

4(2)(a), (b), (e) & (g) of the Securities and Exchange Board of India

(Prohibition of Fraudulent and Unfair Trade Practices relating to Securities

Market) Regulations, 2003 .

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2. Basic grievance of the Appellants is that even though the Appellants

have not indulged in synchronized trades, in the impugned order it is stated

that the Appellants have indulged in synchronized trades as per the chart

annexed thereto. However, the chart annexed to the impugned order does

not contain the names of the Appellants. Thus, it is apparent that the

impugned order has been passed against the Appellants without application

of mind.

3. In para 55 of the impugned order, it is recorded that the Appellant in

Appeal No.409 of 2014 vide his letter dated 19th August, 2014 had stated that

he had bought and sold 500 shares of Spectacle Infotek Limited (SIL) during

the relevant period and that the said transaction was not a synchronized

transaction. The said Appellant had also stated that out of the 500 shares

traded in the said scrip, only 199 shares on the sell side were traded within

the group which were miniscule in nature. The said Appellant had also

stated that he had not indulged in any off-market transactions with any

Pabari-Parikh group in the scrip of SIL-1. These arguments have not been

considered in the impugned order.

4. In these circumstances, since the impugned orders have been passed

callously, we set aside the impugned orders qua the Appellants herein and

restore the matters for fresh decision on merits and in accordance with law.

We hope that on remand, SEBI would entrust the matters to some responsible

officer who would apply his mind and dispose of the matters by passing

order in accordance with law.

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5. All these Appeals are disposed of in the above terms with no order as

to costs.

Sd/-

Justice J.P. Devadhar Presiding Officer

Sd/-

Jog Singh Member

08/03/2016 Prepared & compared by-ddg