Order in respect of Shri Murali Shanmugham - in the matter of Pine Animation Ltd.

WTM/ISD/95/2016 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA ORDER IN RESPECT OF SHRI MURALI SHANMUGHAM – IN THE MATTER OF PINE ANIMATION LTD. 1. Securities and Exchange Board of India ("SEBI"), vide an ad interim ex-parte order dated May 8, 2015 (hereinafter referred to as “interim order”), restrained 178 entities, including Shri Murali Shanmugham (PAN – AEZPM6900L), 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. 2. Towards implementation of the said direction, the demat account number 1205460000189718 held individually by Shri Murali Shanmugham and another demat account number 1205460000207696 held in the name of his mother Mrs. Kamala. S with Shri Murali Shanmugham as a joint holder, have been frozen by the depositories for credit and debit of securities therein. 3. While the proceedings pursuant to the interim order are still in progress, Shri Murali Shanmugham, inter-alia ,requested for de-freezing of the aforesaid demat account number 1205460000207696 held by his mother Mrs. Kamala.

S, jointly with him with Tata Securities Ltd. (depository participant) in view of the following submissions: a. The interim order does not restrain his mother Mrs. Kamala. S. However, her account has been frozen thereby she has been, in effect, restrained. b. All the securities lying in the aforesaid demat account have been purchased by her from her own savings. c. She had kept some of the fixed deposits (FD) in the post office and Banks which she closed in 2013-14 and invested in the shares. d. The income of his mother had not crossed `2 to `2.5 lakhs every year and hence she had not filed her Income Tax return, being a senior citizen. 4. In support of aforesaid claims Shri Murali Shanmugham following documents vide his letter dated May 31, 2016 read with email dated July 25, 2016: a. Bank statement of Mrs. Kamala. S for the period April 01, 2013 to September 30, 2014. b. Ledger statement for the trading account of Mrs. Kamala. S with Tata Securities Ltd, the stock broker. c. Holding statement for the aforesaid demat account as on May 31, 2016. 5. I note that Mrs. Kamala. S has not been restrained by the aforesaid interim order.

She is not holding any shares of Pine Animation Ltd. at present. Prior to the passing of the interim order, Order in the matter of Shri Murali Shanmugham

Mrs. Kamala. S had one transaction in the shares of Pine Animation Ltd. when she transferred of 28,800 physical shares to one Ms. Ritu Khemka on April 30, 2013 which Ms. Khemka dematerialised on January 21, 2014 and is still holding the same in her demat account. This transaction is not part of the scheme alleged in the interim order. 6. From the documents submitted by Mr. Murali Shanmugham I note that : a. Mrs. Kamala. S is the first holder of the demat account number 1205460000207696 held with Tata Securities Ltd. (depository participant). b. The funds have been transferred to the trading account of Mrs. Kamala. S from the bank account singly held by her. c. Prior to every credit of funds in the trading account, monies have been received in the bank account of Mrs. Kamala. S from the General Post Office (GPO), which Shri Murali has submitted that it has been received on maturity of NSC. d. There have been three instances of cash deposit before transfer of funds to the trading account. However, it is seen that payments made to the trading account have been well within the pre-cash deposit balance i.e. the bank account of Mrs. Kamala. S had sufficient balance even prior to the cash deposits. e. It is also seen that the bank account already had a sufficient credit balance received from closure of FD and FD interests. 7. From the above it is noted that the investments in the securities held in the jointly held demat account number 1205460000207696 prima facie belong to Mrs. Kamala. S. 8. Considering the aforesaid submissions and evidences brought on record, I am of the view that the balance of convenience is in favour of Mrs. Kamala. S. Accordingly, I allow Mrs. Kamala. S. to transfer the securities from the demat account number 1205460000207696 held jointly with Mr. Murali Shanmugham with Tata Securities Ltd. to another demat account exclusively held by her in her individual name. 9. The aforesaid shall be subject to the supervision of exchanges and depositories and shall be without prejudice to the findings of pending investigation in the matter.

Sd/- DATE: August 18th, 2016 RAJEEV KUMAR AGARWAL PLACE: MUMBAI WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA