Order in respect of M/s.M.R.Share Broking Pvt. Ltd. in the matter of M/s. Soundcraft Industries Ltd.

WTM/RKA/ID3/55/2013 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA ORDER UNDER SECTION 12(3) OF THE SEBI ACT 1992 READ WITH REGULATION 28(2) OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (INTERMEDIARIES) REGULATIONS, 2008. In respect of M/s M. R. Share Broking Pvt. Ltd. In the matter of M/s Soundcraft Industries Ltd. 1. SEBI noticed that the scrip of M/s Soundcraft Industries Limited (hereinafter referred to as "the company") witnessed sharp fluctuations in its price and volume at Bombay Stock Exchange Ltd. (hereinafter referred to as "BSE") and National Stock Exchange Ltd. (hereinafter referred to as "NSE") during the period July 02, 2001 to January 02, 2002. In view of the same SEBI conducted investigation into the dealing in the shares of the company for the period July 02, 2001 to January 02, 2002 (hereinafter referred to as "investigation period"). It was observed that during the investigation period the price of the scrip of the company had decreased from ₹ 506.50 on July 2, 2001 to ₹ 429.05 on January 2, 2002, i.e., a fall of 15.29%. The traded volumes decreased from 15150 to 2010, i.e. a drop of 86.73%.

During the same period, the BSE indices, Sensex had fallen from 3494 to 3305, i.e., a fall of 5.41%. At NSE, the price of the company’s scrip decreased from ₹ 505.40 on July 2, 2001 to ₹ 428.00 on January 2, 2002, i.e. a fall of 15.31%. The trade volumes decreased from 15215 to 235, i.e., by 98.46%. During the same period, NSE indices, Nifty had fallen from 1101 to 1061, i.e., by 3.63%. 2. On analysis of the trades in the scrip of the company at BSE, it was observed that Shri Rajkumar Chainrai Basantani (hereinafter referred to as "Shri Basantani") along with group of stock brokers viz, AMS Stock Management Pvt. Ltd. (‘AMS’), Kolar Sharex Pvt. Ltd. (‘Kolar’), Churiwala Securities Pvt. Ltd. (‘Churiwala’), Park Light Investment Pvt. Ltd. (‘Park Light’) and M/s. M. R. Share Broking Pvt. Ltd. (hereinafter referred to as ‘the noticee’ ) and their clients tried to establish the price in the scrip through circular trades. It was observed that Shri Basantani, who is an individual trading member of NSE, was also the Chairman and Managing Director (CMD) of the company and one of the directors of Kolar.

During the investigation period, the trading of Shri Basantani alongwith related stock brokers and their clients contributed almost 96% and 65% of the trading in the company’s scrip on the BSE and NSE, respectively. 3. Pursuant to the investigations, SEBI initiated proceedings against the noticee under section 12(3) of SEBI Act, 1992 read with regulation 5(1) of SEBI (Procedure for Holding Enquiry and Imposing Penalty) Regulations, 2002 (hereinafter referred to as 'the Enquiry Proceedings Regulations') (since repealed) and vide an order dated December 12, 2008 suspended the registration of the noticee for a period of one month. In the appeal filed by the noticee against the said order, the Hon'ble Securities Appellate Tribunal (SAT) vide its order dated July 08, 2009 remanded the matter to SEBI to look into matter afresh. 4. Accordingly, the Designated Authority (DA) undertook fresh proceedings in the matter and submitted a Report dated May 11, 2011 in terms of SEBI (Intermediaries) Regulations, 2008 (hereinafter referred to as "Intermediaries Regulations"). In the Report, the DA inter alia found that: (a) The Dhanlaxmi Cotex Ltd., the connected client of the noticee was the second biggest trader in the scrip during the investigation period.

It was also involved in the trades in which the counterparty was Kolar an entity connected with Shri Basantani, CMD of the company. Following stock brokers and clients were the major buyers and sellers in the scrip of the company at BSE during investigation period:-

Client Gross Net % Introducer Sub- Broker trade buy broker Born Free 342358 3386 27.63 Direct Direct Kolar Sharex Pvt. Finance Pvt. Ltd. Ltd. Panna Agrofine 36320 -36000 2.93 Direct Direct Kolar Sharex Pvt. Pvt. Ltd. Ltd. Dhanlaxmi 264279 -1763 21.33 Direct Direct M. R. Share Broking Cotex Ltd. Pvt. Ltd. Ashmita R Shah 175150 496 14.13 Bharat H Gini Park Light Jain Enterprises Investment Pvt. Ltd. Bharat H Jain 69360 0 5.60 Tarun K Gini Park Light Gandhi Enterprises Investment Pvt. Ltd. Sparkling 91900 0 7.42 Direct Direct Churiwala Securities Securities Pvt. Ltd. Jain Investment 208361 -55 16.81 Bharat H Direct AMS Stock (Ramila Jain) Jain Management Total 1187728 -33936 95.85 (b) The total volumes traded in shares of the company at BSE for the period August 1, 2001 to September 28, 2001, was 2,01,963 shares. Out of these shares 1,97,558 shares (98% of the total volumes) were traded amongst the group of aforementioned five stock brokers and their clients. The stock brokers in this group had traded amongst themselves in the scrip in large volumes, without transferring beneficial ownership of the shares. (c) During the period from July 2, 2001 to October 1, 2001, on most of the trading days, each member of the group had squared off its trades and when trades were not squared off, the difference between buy and sell quantity was miniscule (sometimes as less as 3-10 shares) except on July 17, 2001, when Kolar, had a substantial net sell of 35,955 shares. The instances of squaring off trades while trading within the group were noted as following: A. July 2, 2001: i. On July 2, 2001, trading amongst the group of said stock brokers accounted for 100% of the total volumes (15150 shares) as explained in the following table:- Buy Member Sell Member Total Qty AMS Kolar Churiwala MR Park Light Traded AMS 50 500 750 1450 2750 Kolar 2700 100 950 1100 4850 Churiwala 1000 500 1500 MR 3500 3500 Park Light 50 300 900 1300 2550 Grand Total 2750 4850 1500 3500 2550 15150 ii. While trading amongst themselves, each of the members of the group squared off its transactions. While the noticee had sold total 3500 on July 2, 2001 to AMS, Kolar, Churiwala and Park Light, it also bought 3500 shares from Kolar on the same date.

B. July 30, 2001: i. On July 30, 2001, a total of 6745 shares of the company were traded on BSE and 100% of the total volumes on that day were traded amongst the group of stock brokers as explained in the following table:-

Buy Member Sell Member Total Qty AMS Kolar Churiwala MR Park Light Traded AMS 25 600 625 Kolar 625 800 445 25 1895 Churiwala 70 730 800 MR 150 1625 1775 Park Light 1650 1650 Grand Total 625 1895 800 1775 1650 6745 ii. While trading amongst themselves, each of the members in the group of stock brokers had squared off its transactions. The noticee had purchased 1775 shares on July 30, 2001( i.e. 150 shares from Kolar and 1625 shares from Park Light), and had sold 1775 shares (i.e. 600 shares to AMS, 445 shares to Kolar and 730 shares to Churiwala) on the same date. (d) According to the DA the relationships / connection amongst the members of the group brokers and their clients in view of the following factors: i. Shri Basantani, a stock broker at NSE is the director of Kolar and also the CMD of the company. ii. The old registered office address of one of the clients, namely; Jaitra Estate Developers P. Ltd. is the same as the registered office address of Shir Basantani. Another client Panna Agrofine and Jaitra Estate have a common director, Nitin Sawant. Further, Ramesh Verma, director of Jaitra Estate is a dealer with Shri Basantani at NSE.

iii. Ramila B Jain, director of a client, Jain Investment, is the wife of another client Bharat H. Jain who is also the introducer of Asmita R Shah another client. Bharat H Jain has been a registered client with Shri Basantani at NSE for a long period of time. iv. Shri Dhiren Vora, the Director of H. Nyalchand Financial Services Ltd., member NSE is the brother of Shri Uday Vora, director of Park Light. v. The noticee, VRM Share Broking Pvt. Ltd.; a member NSE and Dhanlaxmi, a client are sister concerns. The three entities have a common director, Shri Ramautar Jhawar. vi. Shri Vinod Bagri is the director of AMS. His wife, Smt. Alka Bagri is erstwhile director of AMS. Further, Shri Vinod Bagri’s brother-in-law, Shri Brij Mohan Binani is the Director of AMS. R K Bagchandka, director of R K Global, is introducer of AMS to RK Global. (e) The DA has found that repetitive matching of trades between the related entities cannot be a mere coincidence. The details of the trades of the noticee are sufficient to establish manipulative trades on their part. The shares of company were circulated amongst the group of stock brokers without the intention of transferring the beneficial ownership thereof.

The relationship/connection amongst the entities further corroborates the manipulation. The DA found that related clients and stock brokers traded among themselves to create artificial volumes in the scrip. (f) The DA has noted that the company had passed 3 resolutions during the year 2001 for preferential allotment of its shares. However, the shares were not allotted pursuant to any such resolutions. The company had informed SEBI that it was negotiating with some financial institution for subscription to its shares on preferential basis. As the negotiations were unsuccessful, the company was unable to allot the shares within the time prescribed limit. On examination of the facts and circumstances the DA has found that the deal between the financial institutions and the company did not succeed as the prices were not at the level on which the preferential allotment was sought to be made. The DA has further found that an attempt was made by Shri Basantani, CMD of the company, along with the above mentioned stock brokers including the noticee and their clients related to the company to maintain the price of the scrip at a desired level to attract investors at a price on which the preferential allotments were proposed.

Thus, there was a constant endeavor of the aforesaid related/connected entities including the noticee to keep the price of the scrip at a specific level depicting attractiveness for price and liquidity in terms of volumes. 5. The DA found that the noticee traded among its related entities at BSE to create artificial volumes in the scrip with the intention of artificially manipulating the prices of the scrip and also failed to exercise due diligence while dealing with its clients in the scrip. Thus, the noticee contravened the provisions of regulation 4(a), (b), (c) and (d) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995 (hereinafter referred to as "PFUTP Regulations, 1995") read with regulation 13 of SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 (hereinafter referred to as "PFUTP Regulations, 2003") and clause A(2), A(3) and A(4) of the Code of Conduct for Stock brokers as specified in Schedule II under regulation 7 of SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 (hereinafter referred to as the "Brokers Regulations").

These provisions are reproduced hereunder: 6. SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 1995 Regulation 4: Prohibition against Market Manipulation "No person shall - (a) effect, take part in, or enter into, either directly or indirectly, transactions in securities, with the intention of artificially raising or depressing the prices of securities and thereby inducing the sale or purchase of securities by any person; (b) indulge in any act, which is calculated to create a false or misleading appearance of trading on the securities market; (c) indulge in any act which results in reflection of prices of securities based on transactions that are not genuine trade transactions; (d) enter into a purchase or sale of any securities, not intended to effect transfer of beneficial ownership but intended to operate only as a device to inflate, depress, or cause fluctuations in the market price of securities;" SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 Regulation 13: Repeal and savings "(3) Notwithstanding repeal of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995, any investigation pending, at the commencement of these regulations shall be continued and disposed of in accordance with the procedure laid down in these regulations".

SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 Regulation 7: Stock-Brokers to abide by Code of Conduct. "The stock-broker holding a certificate shall at all times abide by the Code of Conduct as specified at Schedule II. Schedule II: Clause A: (2) EXERCISE OF DUE SKILL AND CARE: A stock-broker, shall act with due skill, care and diligence in the conduct of all his business. (3) MANIPULATION: A stock-broker shall not indulge in manipulative, fraudulent or deceptive transactions or schemes or spread rumours with a view to distorting market equilibrium or making personal gains. (4) MALPRACTICES: A stock-broker shall not create false market either singly or in concert with others or indulge in any act detrimental to the investors interest or which leads to interference with the fair and smooth functioning of the market. A stock-broker shall not involve himself in excessive speculative business in the market beyond reasonable levels not commensurate with his financial soundness. " 7. Based on the findings recorded in the Report, the DA recommended that the certificate of registration granted to the noticee be suspended for a period of one month.

After considering the Report, a show cause notice (SCN) dated May 20, 2011 was issued to the noticee under regulation 28(1) of the Intermediaries Regulations calling upon it to show cause as to why action as recommended by DA should not be taken against it or a higher penalty as deemed fit by the Designated Member should not be imposed upon it. The noticee vide its letter dated October 14, 2011 submitted its reply to the SCN. The submissions of the noticee inter alia are as under: i. The noticee has not been provided with a copy of the Investigation Report and complete trade and order log which is in violation of principles of natural justice. ii. The noticee has denied all the allegations and submitted that the allegations in the SCN are baseless, bald, sweeping, vague, unfounded, misconceived, speculative and self contradictory, based on assumptions, surmises and conjectures and are completely contrary to factual position on record. iii. During the investigation period 2,06,920 shares were traded out which 37,345 shares were traded by the noticee. Details of shares traded by the noticee have been provided to the noticee but details for remaining shares have not been provided to it. iv.

Annexure 5 of the pre enquiry SCN enumerates only sell trades between the noticee and Partklight Investment Pvt. Ltd, whereas the SCN dated May 20, 2011 enumerates in the para 14(i) that the noticee had sold 750 shares to AMS Stock Management, 950 shares to Kolar Shares Pvt. Ltd and 500 shares to Churiwal Securities Pvt. Ltd. In view of the above discrepancy either the SCN contains incorrect fact as the details provided in the SCN are not substantiated by the corresponding details provided to the noticee or the trade log provided to it is incorrect. v. The DA in its Repot at para 3 and 4 observed that during the investigation period the volume and price of the scrip of the company had dropped. Prior to this period the price and volume of the scrip of the company had continuously risen. The company had passed 3 resolutions during the year 2001 for preferential allotment of shares. Any company which will make any such announcement will necessary see a good price. However, it is also pertinent to note that any company which has been continuously failing in raising funds clearly sends a signal that it is not prepared properly for such an allotment or there may be fundamental problems due to which it is constantly failing in achieving its target and in the process is incurring costs for the same and repetitive failures on the part of the company will clearly spoil the market sentiments pertinent to the scrip and will draw investors/trades away from it. vi.

The noticee had executed all its trades in the scrip of the company on behalf of its client viz. Dhanlaxmi, therefore no negative inference should be drawn on the basis of the same. Further, all the trades were through the online stock exchange mechanism, where it is not possible for the noticee to ascertain who the counter parties were, therefore the allegation that it traded with other entities forming a group is baseless and fallacious. The purchase of 3500 shares on July 02, 2001 from Kolar at the floor of BSE was made in the normal course of trading. The Report does not show any link/connection/nexus of the noticee or its client with Kolar. These 3500 shares were sold on July 02, 2001 and were purchased by 5 different entities. Further, on July 30, 2001 the noticee had bought and sold 1775 shares for its client. Out of 1775 shares bought by the noticee, 1625 shares were sold by Park

Light and 150 shares were sold by Kolar. Out of 1775 shares sold by the noticee, 600 shares were bought by AMS, 730 shares were bought by Churiwala and 445 shares were bought by Kolar. The noticee had placed total 15 buy order during the investigation period which resulted into 51 buy trades. These facts clearly show that buying and selling of shares of the company was done by the noticee on a random basis without having any knowledge as to who is the counter party broker of client. Further, had the noticee been interested in creating artificial volume along with the counterparty as alleged, it would have placed more frequent orders. The Report fails to provide the counter party order time / price and quantity which are essential ingredient to show that there was any mutual understanding between the noticee and the counter party at the time of placement of orders. vii. The noticee is jobber and is engaged into intraday trades, which is permissible by law. The fact that the noticee and other alleged entities constituted for 100 % of the total volumes, does not establish that these entities are linked to each other.

If there were only four entities trading in the particular scrip it is natural that the traded of these entities will match will each other. Therefore, this matching cannot become the very basis of allegation of all the four entities forming part of group and having link to each other. viii. While the noticee, VRM and Dhanalaxmi Cotex are sister concerns and have a common director, Mr. Ramautar Jhawar; neither the noticee nor his client has any link/connection/nexus with any of the entities of the alleged group. ix. The DA in its report has found that a group of entities formed by Shri Basantani executed trades on NSE and BSE with the objective of creating market interest in the scrip of the company. The noticee is not concerned with the success/failure of the deal between the company and financial institutions. The noticee is not able to understand the basis on which it has been alleged that the noticee was involved in the alleged attempts made by Shri Basantani along with the brokers and clients related to the company to maintain the price of the shares of the company at a desired level to attract investors at a price which the preferential allotment were proposed.

One R. K. Global Shares and Securities Ltd. was one of the members of alleged group. Hon'ble Securities Appellate Tribunal (SAT) vide its order dated September 16, 2010 has set aside the SEBI's order in the matter of R.K. Gobal Shares and Securities Ltd. on the grounds that no relationship could be established between the group entities. x. The noticee has not indulged in any manipulative, fraudulent or deceptive transactions or schemes as alleged. Further, the noticee has not gained any undue advantage by its trading the scrip of the company. It has exercised adequate due diligence as reasonably expected from a prudent broker while transacting on behalf of its clients. xi. Hon'ble SAT in the case of Sterlite Industries Ltd. vs SEBI (2001) 34 SCL485 has observed that :"In this contest it is to be noted that Chairman holding the Appellant guilty of indulging in price manipulation has stated that "creation of false market and price manipulation is a very serious offence." Evidence merely probabalising and endeavoring to prove the fact on the basis of preponderance of probability is not sufficient to establish such a serious offence of market manipulation. xii.

Hon'ble Supreme Court in M. S. Bindra v. UOI (1998) 7 SCC 310 has observed that in quasi judicial proceedings the tribunal should arrive at its conclusion on the basis of some evidence, i.e. evidential material which with some degree of definiteness points to the guilt of the delinquent in respect of the charges against him and suspicion cannot be allowed to take a place of proof even in domestic inquiries. 8. During the personal hearing granted to the noticee in the matter it again requested for Trade Log and Order Log. Accordingly, SEBI provided to the noticee the abstract of Order Log and Trade Log relevant to it along with day wise breakup of its trades in the scrip during the investigation period. The noticee was also advised to submit its reply within 15 days from the receipt of the said details. However, the noticee, despite additional time provided to it on its request, failed to submit any additional reply / submission after the personal hearing and on furnishing of desired information/details again after the personal hearing. I, therefore, proceed to deal with the matter on the basis of the SCN, replies/submissions of the noticee and other material on record.

9. The noticee has contended that it has not been provided with a copy of the investigation report in the matter. In this regard, I note the Report has been submitted by the DA after considering all the facts found during the investigation. It is this Report which is the basis of the charge in the SCN and the basis of charges and allegations against the noticee are narrated in the SCN and the Report. As per the procedure prescribed in regulation 28 of the Intermediaries Regulations, after considering the Report, the SCN is issued enclosing a copy of the Report of the DA calling upon the noticee to submit its written representation. In this case, the SCN has been issued to the noticee under the said regulation 28 enclosing therewith a copy of the Report that is a self contained document containing all the allegations and charges against the noticee. Since the procedure laid down in the regulation is strictly followed in this case, the grievance of violations of principles of natural justice is without any foundation as held by Hon'ble Securities Appellate Tribunal (SAT) in the case of Manoj Gaur Vs. SEBI ( Appeal Number 64 of 2012- order dated October 03, 2012).

I further note that the SCN and the Report clearly mention the provisions of law alleged to have been violated by the noticee. I, therefore, do not find violation of principles of natural justice in this case as contended by the noticee. 10. The other contention of the noticee is that it had not been provided with the complete trade and order log. In this regard, it is settled position that the principles of natural justice require that the relevant information/document/material relied upon in support of the charges / allegations should be furnished to the noticee. In this case, I note that the order log and trade log relevant to the noticee had been furnished to it by the DA during the proceedings before her and also along with the SCN. Nevertheless, as requested by the noticee during the personal hearing, it was again provided with all the relevant details with regard to its order log and trade log with all details as requested by it during the personal hearing. I, therefore, find that the principles of natural justice have been complied with in the present proceedings in this regard also and contention of the noticee is unfounded.

11. Now I proceed to deal the matter on merits. The DA has found that Shri Basantani, CMD of the company along with related/connected stock brokers and clients attempted to maintain the price of the scrip at the desired level to attract investors at a price on which the preferential allotments were proposed by the company pursuant to its three resolutions passed by its shareholders during the year 2001. There was constant endeavour by these related/connected entities to keep the price of the scrip at a specific level depicting attractiveness for price and liquidity in terms of volumes through their fraudulent trades in the scrip during the investigation period. DA has observed that since the price did not reach at the desired level, the preferential allotment had failed. I note that the background and the purpose, as found in the Report for which the transactions in question were undertaken, suggested a concerted plan and device orchestrated by Shri Basantani along with related / connected clients/ stock brokers including the noticee. I, further, note that the Report is limited with regard to the trades of these entities at BSE during the investigation period.

12. I, further, note that basis of the charge against the noticee are: i. the inter se connection with other four stock brokers, namely, AMS, Kolar, Churiwala and Park Light, the clients for whom the transaction in question were undertaken and Shri Basantani; and ii. nature and pattern of transactions of the noticee in the scrip during the investigation period. 13. Admittedly, the noticee its client, Dhanlaxmi for which it traded in the scrip at BSE and VRM Share Broking Pvt. Ltd., a stock broker and a member of NSE are connected with each other. However, the noticee has denied its connection with any other stock broker, client, Shri Basantani as alleged in the SCN. I have examined the factors considered by the DA for coming to her findings in this regard and find that, except for the connection of noticee with its client Dhanlaxmi, those factors do not suggest any direct or indirect connection of noticee with other entities, namely, Shri Basantani, Jaitra, Kolar, Jain Investment, Ashmita R Shah, Bharat H Jain, H Nyalchand Financial Services Ltd., Park Light, AMS and R. K. Global, who are alleged to be connected with each other.

The factors also do not suggest any connection of Dhanlaxmi (i.e. the entity connected with the noticee) with any other clients or stock brokers mentioned in the Report. 14. I note that the investigation period with regard to the trades in the scrip at BSE is between July 02, 2001 to January 02, 2002 and the considerable time has elapsed since then. One of the charges against the noticee is that it had along with other stock brokers and clients fraudulently tried to maintain the price of shares of the company during the investigation period. However, I note that price of the shares of the company has fallen by more than 5 times as compared to BSE and NSE market indices during the investigation period. I, further, note that the traded volumes in the scrip at BSE had decreased from 15510 to 2010 shares (drop of 86.73%) during the investigation period.

15. As per the Report, group of clients trading through Kolar, AMS, Churiwala, Park Light and the noticee who are allegedly connected with each other, contributed almost 96% of the trading in the scrip on the BSE during investigation period. The Report has given instances of trades of the aforesaid entities on July 02, 2001 and July 30, 2001 and has found that during August 01, 2001 to September 28, 2001, out of the total traded volume of 2,01,963, the trades of these entities amongst themselves had contributed to 1,97,558 shares (98% of the total volume trades for the said shares). The DA has further found that from July 02, 2001 to October 02, 2001 they had traded in the same pattern wherein they traded amongst themselves and squared off their transactions on most of the days. The DA has concluded that the shares were circulated amongst the group of connected stock brokers and clients without intention of transferring the beneficial ownership. 16. In this case, I note that on specific trading days, the shares were transacted and circulated amongst the clients of five stock brokers including the noticee and most of the transactions were squared off.

In my view, merely because the noticee and its other counter party brokers squared off their position on most of the trading days, it cannot be concluded that the trades were fraudulent. However, when the shares are transacted and circulated amongst the connected entities acting in a league under a premeditated manipulative plan such transactions can be fraudulent. Such fraudulent intent can be ascertained on the basis of facts and circumstances, pattern of trading, relation amongst the parties, etc. In order to prove the allegation of fraudulent or unfair trade practices higher degree of preponderance of probability is required. In this case, the link between the noticee Shri Basantani and other connected entities has not been established and it cannot be said that the noticee was part of the manipulative device of Shri Basantani and a network of entities related with him or other stock brokers. Further, there is no material to suggest complicity of the noticee in any manipulative and fraudulent device of other entities or meeting of minds amongst the noticee and other entities. 17. Considering the above facts and circumstances, I am of the view that preponderance of probability in this case is in favour of the noticee.

I, therefore, give the noticee the benefit of doubt and do not consider it necessary to issue any action against it as contemplated in the SCN.

18. The SCN dated May 02, 2011 issued to M/s. M. R. Share Broking Pvt. Ltd. is accordingly disposed of.

Date: December 20, 2013 RAJEEV KUMAR AGARWAL Place: Mumbai WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA