Order against M/s. Shah Trading Company (Proprietor: Mr. Naresh K. Shah) in the matter of Pyramid Saimira Theatre Ltd

1. Securities and Exchange Board of India (hereinafter referred to as SEBI) in the matter of Pyramid Saimira Theatre Limited, vide ex-parte ad-interim order dated April 23, 2009 (hereinafter referred to as the Order), had inter alia prohibited a large number of persons/entities and their proprietors/partners/directors, who prima facie appeared to have carried out suspicious banking transactions and channeled those funds either directly or indirectly in the stock market, not to buy, sell or deal in the securities market including in Initial Public Offerings, in any manner, either directly or indirectly, till further directions. One such entity prima facie found to have appeared in the fund transfers was M/s. Shah Trading Company (Proprietrix, Ms. Hetal R. Shah) having account no: 023010200019752 with Axis Bank, Virar branch. The name of the proprietor (Ms. Hetal R. Shah) along with the bank account details of the said entity were mentioned in the Order. The said details were as per the information provided by Axis Bank. Thereafter, Ms. Hetal R. Shah and Mr. Kautik Shah representing M/s. Shah Trading Company appeared before me in the personal hearing held on December 1, 2009. Ms. Hetal Shah stated that she was not aware about Chandan Gems and denied having received or paid any sum to the said entity. An inspection was also granted to M/s. Shah Trading

Company on the said date. In view of the specific submissions made by Ms. Hetal R. Shah, SEBI sought clarification from Axis Bank. The said Bank, vide letter dated December 23, 2009 stated that the credit of Rs. 50,00,000/- to M/s. Chandan Gems on August 6, 2008 was by way of transfer from the account of one M/s. Shah Trading Company (Proprietor, Mr. Naresh K. Shah) having account number 465010200001342 maintained with Axis Bank, Lamington Road branch. The said Bank also enclosed copies of the account opening forms and “Know Your Client” documents in respect of the aforesaid account. As already stated in the Order, various entities/persons appeared to have carried out suspicious banking transactions and have channeled those funds, either directly or indirectly in the securities market. One such entity was M/s Chandan Gems to which M/s Shah Trading Company (Proprietor, Mr. Naresh K. Shah) had credited Rs. 50,00,000/-, as stated above. It is noted that there was no fund transfer from the account of M/s. Shah Trading Company (Proprietrix, Ms. Hetal R. Shah) and M/s Chandan Gems. In view of the above, it is just and reasonable that the directions passed vide ex-parte ad-interim order dated April 23, 2009 against M/s. Shah Trading Company (Proprietrix, Ms. Hetal R. Shah), be vacated. Further, it becomes necessary to restrain M/s. Shah Trading Company (Proprietor, Mr. Naresh K. Shah) having account number 465010200001342 maintained with Axis Bank, Lamington Road branch from dealing in the securities market.

2. In view of the foregoing, in exercise of powers conferred upon me under Sections 11, 11B and 11(4) of the Securities and Exchange Board of India Act, 1992, I, hereby issue the following directions:

a. M/s. Shah Trading Company (Proprietor, Mr. Naresh K. Shah, Permanent Account Number: BAQPS9096D) having account number 465010200001342 maintained with Axis Bank, Lamington Road branch, is hereby directed not to buy, sell or deal in the securities market including in Initial Public Offerings, in any manner, either directly or indirectly, till further directions. b. The concerned stock exchanges are advised to allow M/s. Shah Trading Company (Proprietor, Mr. Naresh K. Shah) to square off its existing open positions in the Futures and Options Segment, if any, immediately. The said entity would not be allowed to take fresh positions or increase its open positions or execute trades. Further, the concerned stock exchanges should also ensure that no fresh positions are created for the said entity. c. M/s. Shah Trading Company (Proprietor, Mr. Naresh K. Shah) may file its objections, if any, to the Order within a period of twenty one days from the date of its receipt. d. The directions passed by Securities and Exchange Board of India, vide Order dated April 23, 2009 against M/s. Shah Trading Company (Proprietrix, Ms. Hetal R. Shah), mentioned at serial No. 188 at page 31 of the said Order, having account no: 023010200019752 with Axis Bank, Virar branch, are hereby revoked. 3. This Order shall be read in conjunction with the Order dated April 23, 2009 and shall come into force with immediate effect. 4. A copy of the Order dated April 23, 2009 shall be forwarded to M/s Shah Trading Company (Proprietor, Mr. Naresh K. Shah) along with the copy of this Order. 5. The remaining part of the Order dated April 23, 2009 remains unchanged.

DR. K.M. ABRAHAM WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA PLACE: MUMBAI DATE: FEBRUARY 3, 2010