Order in respect of Venture Business Advisors P. Ltd. and its Director, Mr. Vineet Kumar[SAT Appeal No.:116/2015]

WTM/SR/IVD/ID-4/ 54 /08/2014 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA CORAM: S. RAMAN, WHOLE TIME MEMBER ORDER Under Sections 11 and 11B of the Securities and Exchange Board of India Act, 1992 read with Regulation 11 of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 against Venture Business Advisors P. Ltd. (PAN : AAACV7487P) and its Director, viz. Mr. Vineet Kumar (PAN: AACPV9310Q) in the matter of manipulative trading in the shares of Temptation Foods Ltd.

1. Securities and Exchange Board of India (hereinafter referred to as 'SEBI') vide its ad interim ex parte order dated June 4, 2009, inter alia restrained a group of 26 entities including Venture Business Advisors Pvt. Ltd. (hereinafter referred to as "VBAPL"), the promoter of the Company, Temptation Foods Ltd. (hereinafter referred to as 'Temptation') from accessing the securities market and further prohibited them from buying, selling or dealing in securities market, directly or indirectly till further orders, as these entities including VBAPL were prima facie found to be instrumental in manipulating the trading in the scrips of five companies one of which was Temptation, during the period January 2007 to February 2009. The aforesaid ad interim ex parte was later confirmed, vide Order dated June 30, 2010 against VBAPL for its alleged manipulation in the scrip of Tempatation during the period August 01, 2007 to February 28, 2009 (hereinafter referred to as "investigation period").

2. The alleged manipulations in the scrip of Temptation during the investigation period by a group of connected entities namely, Chandra Financial Services P. Ltd. ('CFSPL'), Kundan Leasing and Finvest P. Ltd. (‘KLFPL’), Jay Investrade P. Ltd. (‘JIPL’), HSM Financial Services P. Ltd. (‘HSM’), Shanti Financial Services P. Ltd. (‘SFSPL’), Maruti Securities Ltd. ('MSL'), Acme Craft P. Ltd. ('ACPL'), Beejay Investments & Financial Consultants P. Ltd. ('Beejay Investments'), Stupendors Traders P. Ltd. ('STPL'), Eversight Tradecomm P. Ltd. ('Eversight'), Mr. Sudhir Jain, Ms. Samta Jain and VBAPL (hereinafter referred collectively as "connected entities" and individually by their respective names) were detected during routine market surveillance by SEBI. The preliminary examination of the trade data relating to the scrip, revealed inter-linkages among the "connected entities", including

VBAPL, in the form of off-market transactions as well as synchronized deals in the market. These entities including VBAPL were found to have traded in large concentration in the scrip of Temptation and a substantial portion of their trading amongst themselves in synchronized manner was found to have contributed to the increase in the market volume in the scrip of Temptation.

3. SEBI conducted a detailed investigation into the trading in the shares of Temptation for the investigation period. Upon completion of the investigation, show cause notice (SCN) dated July 27, 2011 was issued to VBAPL and its director, Mr. Vineet Kumar, who was the director in charge of and responsible for the conduct of business of VBAPL during the period of investigation for the alleged violation of Regulation 3(a), (b), (c) & (d) and Regulation 4(1), 4(2) (a), (b), (d), (e) & (g) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations 2003 ('PFUTP Regulations, 2003') read with Section 12A (a), (b) & (c) of SEBI Act, 1992, in respect of the manipulative trading in the scrips of Temptation (Mr. Vineet Kumar and VBAPL, hereinafter together referred to as "noticees" and individually by their respective names). Following were the allegations leveled against the noticees in the SCN:

i. VBAPL, one of the promoters of Temptation, transferred shares of Temptation through off-market deals to "connected entities", which were then utilized to enter into circular transactions to create artificial volumes in the scrip of Temptation during the investigation period.

ii. Furthermore, VBAPL transferred funds to one of the connected clients, which was then employed to generate trading interest in Temptation thereby creating artificial volumes and increasing the price of the scrip of Temptation.

iii. Therefore, VBAPL and its director, Mr. Vineet Kumar, who was in-charge of the day-to-day management of VBAPL during the relevant period, have indulged in acts, which led to the creation of false or misleading appearance of trading in the scrip of Temptation with no intention of transfer of beneficial ownership and manipulated the price of the scrip.

4. I note that despite several letters and reminders from SEBI, the noticees neither filed their reply to SEBI's SCN dated July 27, 2011 nor have availed the opportunity for personal hearing which was communicated to them vide letter dated March 26, 2013. The noticees, vide letters dated December 28, 2011 and February 17, 2012 had sought inspection of documents. SEBI, vide letters dated January 6, 2012 and February 23, 2012 replied that all the relevant documents which, SEBI had relied on for the purpose of the SCN had already been forwarded to the noticees along with the SCN. Further, the noticees were also advised to indicate the specific document, which they require along with their reply. However, no reply was received from the noticees. Finally, vide letter dated March 26, 2013, the noticees were advised to indicate before April 15, 2013 whether they would like to avail the opportunity of personal hearing in the matter. I note that the noticees, neither submitted any reply nor availed the opportunity of personal hearing. From the above, it is observed that the noticees have been provided with enough opportunity to submit their reply and to avail the opportunity of personal hearing. In the absence of any proper reply from noticees, I am constrained to proceed with the matter ex parte on the basis of the materials and information available on record.

CONSIDERATION OF ISSUES AND FINDINGS

5. I have considered the SCN dated July 27, 2011 issued by SEBI, correspondence exchanged between noticees and SEBI and other materials available on record. In light of the same, I shall now proceed to deal with the charges alleged against the noticees in the SCN. It is alleged that the noticees, along with the "connected entities", have indulged in acts, which led to the creation of false or misleading appearance of trading in the scrip of Temptation with no intention to transfer beneficial ownership of shares and manipulated the price of the scrip. The issues that arise for consideration in the instant case are, i. Whether the noticees have indulged in circular and reversal trades, which created misleading appearance of trading in the scrip of Temptation? ii. Whether the noticees have transferred funds to one of the connected clients, which was then employed to generate trading interest in Temptation thereby creating artificial volumes and increasing the price of the scrip of Temptation?

6. Before proceeding further, the relevant provisions of the Regulations alleged to have been violated by the noticees may be reproduced for reference purpose, Regulation 3 of the PFUTP Regulations, 2003 3. Prohibition of certain dealings in securities No person shall directly or indirectly— (a) buy, sell or otherwise deal in securities in a fraudulent manner; (b) use or employ, in connection with issue, purchase or sale of any security listed or proposed to be listed in a recognized stock exchange, any manipulative or deceptive device or contrivance in contravention of the provisions of the Act or the rules or the regulations made there under; (c) employ any device, scheme or artifice to defraud in connection with dealing in or issue of securities which are listed or proposed to be listed on a recognized stock exchange; (d) engage in any act, practice, course of business which operates or would operate as fraud or deceit upon any person in connection with any dealing in or issue of securities which are listed or proposed to be listed on a recognized stock exchange in contravention of the provisions of the Act or the rules and the regulations made there under.

Regulation 4 of the PFUTP Regulations, 2003 4. Prohibition of manipulative, fraudulent and unfair trade practices (1) Without prejudice to the provisions of regulation 3, no person shall indulge in a fraudulent or an unfair trade practice in securities. (2) Dealing in securities shall be deemed to be a fraudulent or an unfair trade practice if it involves fraud and may include all or any of the following, namely:— (a) indulging in an act which creates false or misleading appearance of trading in the securities market; (b) dealing in a security not intended to effect transfer of beneficial ownership but intended to operate only as a device to inflate, depress or cause fluctuations in the price of such security for wrongful gain or avoidance of loss; (c) advancing or agreeing to advance any money to any person thereby inducing any other person to offer to buy any security in any issue only with the intention of securing the minimum subscription to such issue; (d) paying, offering or agreeing to pay or offer, directly or indirectly, to any person any money or money’s worth for inducing such person for dealing in any security with the object of inflating, depressing, maintaining or causing fluctuation in the price of such security; (e) any act or omission amounting to manipulation of the price of a security; (f) publishing or causing to publish or reporting or causing to report by a person dealing in securities any information which is not true or which he does not believe to be true prior to or in the course of dealing in securities; (g) entering into a transaction in securities without intention of performing it or without intention of change of ownership of such security; 7. Findings

7.1 On analysis of the material available on record, it is observed that from March 2007 to July 2007 (i.e. prior to the investigation period), the average monthly traded quantity of shares of Temptation in BSE was 71,580 shares whereas, during August 2007 to February 2009 (hereinafter referred to as "investigation period"), the average monthly market traded quantity increased to 12,14,133 shares. Thus, the average trading volume in the shares of Temptation increased as much as 17 times during the investigation period. Further, out of the average monthly market traded quantity of 12,14,133 shares during the investigation period, as much as 5,08,158 shares (constituting 41.85% of market quantity) were found to have been contributed by "connected entities". It was further observed that in the months of October 2007 and February 2008, the "connected entities" had contributed to more than 90% of the market traded quantity. From the above, it is observed that during the said two months there was negligible trading interest in the scrip of Temptation other than trades executed by "connected entities". A summary of data relating to trading by "connected entities" during the investigation period in the scrip of Temptation is as under:

Scrip (Period) Volume Total Volume "Connected "Connected "Connected Concentration (BSE) entities" entities" entities" Total buy sell Traded Volume quantity quantity Number of 2,30,68,520 53,88,533 63,23,928 1,17,12,461 Temptation shares (Aug 2007 to as a % of total 100% 23.36% 27.41% 50.77% Feb 2009) volume

From the above table, it is observed that the connected entities have contributed 50.77% to the total market volume out of which the buy volume and sell volume contribution were 23.36% and 27.41% to the total market volume. Out of the total traded volume of 1,17,12,461 shares (50.77%) contributed by the "connected entities", the volume of 96,54,749 shares (41.85%) were contributed by the trades executed between connected entities and other entities during the period and the remaining volume of 20,57,712 shares (8.92%) were contributed by the trades executed among the connected entities.

Connection Amongst the entities 7.2 The observations regarding the nexus amongst the "connected entities" and their interse linkages on the basis of analysis of off-market transfers, Know Your Client documents, bank statements, data collected from brokers, Registrar to Issue, depository participants, Registrar of Companies etc, as well as statements, submissions and admissions made by the "connected entities" during investigation, as discussed in the SCN are as under;

• Five of the "connected entities", who had traded in the scrip of Temptation viz. Chandra

Financial Services P. Ltd. ('CFSPL'), Kundan Leasing and Finvest P. Ltd. (‘KLFPL’), Jay Investrade P. Ltd. (‘JIPL’), HSM Financial Services P. Ltd. (‘HSM’) and Shanti Financial Services P. Ltd. (‘SFSPL’) have common directors viz. Mr. Harsh Shirish Maniar and Mr. Jay Shirish Maniar and also have common address at Achal Bhuvan, 3rd Floor, 21 Modi Street, Fort, Mumbai. These entities are related to each other and have been collectively referred to as 'Maniar Group' and individually by their respective names.

• Further, it was also observed that two of the "connected entities", who had also traded in the scrip of Temptation viz; Maruti Securities Ltd. ('MSL') and Acme Craft P. Ltd. ('ACPL') had financial dealings and off-market transfer of shares with Maniar Group, leading to the reasonable conclusion that they knew each other. The same has already been clearly brought out in the aforesaid ad interim ex-parte order dated June 04, 2009.

• VBAPL in its letter dated July 14, 2009 to SEBI, stated that the directors of CFSPL are known to them and the shares were given to CFSPL as loan on "friendly basis".

• VBAPL is the promoter of Temptation and a shareholder of another connected entity, viz. Stupendors Traders P. Ltd. ('STPL'). It is further noted that one Mr. Vicky Kothari is the director of STPL, who is the brother-in-law of Mr. Sudhir Jain; the director of another connected entity, viz. Beejay Investments & Financial Consultants P. Ltd. ('Beejay Investments').

• The Directors of another connected entity, viz. Eversight Tradecom P. Ltd. ('Eversight'), (Mr. Adish Jain and Mr. Peeyush Jain) are distant relatives of Mr. Sudhir Jain.

• Further, the fund transfers from the account of VBAPL to Beejay Investments as detailed in paragraph No. 7.3.1 below, also substantiates the connection between VBAPL and Beejay Investments.

7.2.1From the above, it is clear that the aforesaid entities including VBAPL are connected to one another and together form a group. I, now proceed to examine, in the following paragraphs, the details of the trades in the scrip of 'Temptation' during relevant investigation period in order to deal with charges leveled against the noticees in the SCN.

PRICE MANIPULATION DURING THE PERIOD AUGUST 1, 2007 TO OCTOBER 17, 2007

7.3 From the SCN, it is noted that the price of the scrip increased from `95.95/- on August 1, 2007 to `257/- on October 17, 2007 indicating a price rise of 167.85% in 54 trading sessions with 20,04,766 shares traded in 3,740 trades. It was alleged that the buy trades of Beejay Investments, Mr. Sudhir Jain and Ms. Samta Jain had price impact of `67.50, `44.90 and `9.45 respectively and contributed significantly to increase in the price of shares of Temptation. During the period, there were totally 1,003 buy trades, which were executed at a price higher than the last traded price, of which, 304 buy trades were executed by the aforesaid three entities.

7.3.1 It was alleged in the SCN that VBAPL, the promoter of Temptation through active connivance with Beejay Investments, Mr. Sudhir Jain and Ms. Samta Jain facilitated in creating volumes to generate interest and also manipulated the price of the scrip of Temptation. In this regard, it is noted from the SCN that during the period between August 1, 2007 and October 17, 2007, Beejay Investments bought 2,87,698 shares of Temptation (i.e. 14.35% of the market volume) and Mr. Sudhir Jain bought 1,11,992 shares (i.e. 5.59% of the market volume) through the trading members Religare Securities Ltd. ('Religare'), B Lodha Securities P. Ltd. ('B. Lodha') and Sharekhan Ltd. ('Sharekhan'). Ms. Samta Jain bought 16,279 shares of Temptation through trading member B. Lodha. I further note from the SCN that the bank account statement (Account No. 02772320000303) of Beejay Investments revealed that on July 31, 2007, `1,00,00,000/- was transferred to the account of Beejay Investments from the account of VBAPL (Account No. 5012000006810). Thereafter, on July 31, 2007 Beejay Investments credited the amount to the account of trading member Sharekhan and on August 2, 2007 Beejay Investments bought 4,300 shares of Temptation (i.e. 76.78% of the market volume) through Sharekhan. It was observed that Beejay Investments, Mr. Sudhir Jain and Ms. Samta Jain bought shares in 40 trading sessions and their buy trades contributed more than 75% in 20 trading sessions. For instance, on October 8, 2007 Mr. Sudhir Jain through Sharekhan bought 9,100 shares, which was 100% of the market volume.

7.3.2 In view of the aforesaid allegations in respect of price manipulation, the entity-wise details like gross purchases, net impact of buy trades, number of buy trades at price above/at/below Last Traded Price (LTP) etc. as given in the Annexures to the SCN have been analyzed. I find that the total trades executed by Beejay Investments, Mr. Sudhir Jain and Ms. Samta Jain in the scrip of 'Temptation' at the price higher than LTP are less than the total trades executed by them at price lower than LTP and at the LTP. For instance, during the period August 1, 2007 to October 17, 2007, I note that Beejay Investments, Mr. Sudhir Jain and Ms. Samta Jain had traded for 3,09,212 shares in 904 trades which were executed at LTP or at price lower than LTP as compared to 1,06,757 shares in 304 trades at price higher than LTP. From these facts, I find that Beejay Investments, Mr. Sudhir Jain and Ms. Samta Jain placed more shares and orders at LTP or at price lower than LTP, than at price higher than LTP. Hence, I am of the considered view that there is no substantial evidence in the SCN to establish the allegation of price manipulation. I, therefore, find that the charge of price manipulation in the scrip of 'Temptation' under Regulations 4(2) (b) and (e) of PFUTP, is not conclusively established against the noticees as observed above. However, from the pattern of trading by Beejay Investments and the transfer of funds by VBAPL to Beejay Investments as discussed in the preceding paragraphs, it can be safely inferred that they traded in a co-ordinated and concerted manner duly aided and abetted by VBAPL.

REVERSE TRADES ON JULY 2, 2008 AND JULY 4, 2008

7.4 The SCN further alleges that the entities connected with VBAPL, executed reversal trades in the shares of 'Temptation' in a co-ordinated and concerted manner duly aided and abetted by VBAPL; the promoter entity of 'Temptation', which created artificial volume in the scrip of 'Temptation' and also generated artificial interest in the scrip. In this regard, it is noted that on July 2, 2008 CFSPL received 1 lac shares of 'Temptation' in 'off-market' from VBAPL and on July 4, 2008, CFSPL transferred these 1 lac shares back to VBAPL in 'off-market'. I further note from the SCN that after the receipt of aforesaid 1 lac shares from VBAPL in 'off market' on July 02, 2008, CFSPL had entered into several reversal trades with MSL through market transactions. The details of which are as under:-

Table 1 - Reversed Trades Trade Trade Trade Order Order Buy Buy Sell Sell Traded CP CP Time Qty Rate Date No Rate Qty Rate Client Client Client Client Qty Order Order Diff Diff Diff Name Member Member Name Qty Rate Name Name 2-Jul-08 72 307.80 25000 308.00 MSL CJ Dalal Lalkar CFSPL 25000 25000 307.80 0:00:07 0 0.20

0.20 2-Jul-08 104 324.75 25000 324.95 MSL CJ Dalal Lalkar CFSPL 24500 25000 324.75 0:00:12 0 2-Jul-08 124 323.00 25000 325.00 MSL CJ Dalal Lalkar CFSPL 24850 25000 323.00 0:00:13 0 2.00 2-Jul-08 127 323.75 25000 325.00 MSL CJ Dalal Lalkar CFSPL 25000 25000 323.75 0:00:08 0 1.25 4-Jul-08 44 323.00 100000 323.40 CFSPL CJ Dalal CJ Dalal MSL 100000 100000 323.00 0:00:10 0 0.40

7.4.1 From the above table, it is observed that on July 02, 2008, MSL bought 25000 shares each from CFSPL on market through four different trades and on July 04, 2008, CFSPL bought back 1,00,000 shares from MSL on market. In this regard, I note that the total market volume in this scrip on July 2 and 4, 2008 was 1,47,851 shares and 1,44,078 shares, respectively and thus these reversed trades contributed approximately to 65% of the total market volume on those two days. It is noted that the said shares which were deployed by the entities to create artificial volume were transferred by VBAPL through off-market route. In view of this, it can be concluded that the said entities traded in the shares of 'Temptation' in a co-ordinated and concerted manner duly aided and abetted by VBAPL; the promoter entity of 'Temptation', which created artificial volume in the scrip of 'Temptation' and generated artificial interest in the scrip, which induced the gullible investors to invest in the shares of 'Temptation'.

CIRCULAR TRADES 7.5 The SCN alleges repeated instances of circular trades over a period of time amongst the connected clients, duly abetted and aided by VBAPL. It is noted from the SCN that on December 8, 2008, VBAPL, the promoter of 'Temptation' transferred 3,10,000 shares of 'Temptation' through 'off-market' to SFSPL. Out of these 3,10,000 shares, SFSPL transferred 40,000 shares through 'off-market' to CFSPL in two tranches i.e. 10,000 shares on December 11, 2008 and 30,000 shares on December 15, 2008. These 40,000 shares of 'Temptation' were introduced in the 'market' and then traded amongst CFSPL, KLFPL, JIPL, MSL and ACPL through circular trading. On December 24, 2008, these 40,000 shares were transferred back by CFSPL to SFSPL through 'off -market' transfer. Subsequently, on December 30, 2008, SFSPL transferred back the 40,000 shares of 'Temptation' to VBAPL in off-market. These 'off-market' and 'market' transactions in the scrip of 'Temptation' are described in the following tables:- Table-II 'Off-Market' Transactions: Execution Date Transferred from Transferred to Quantity 08-Dec-08 VBAPL SFSPL 3,10,000 11-Dec-08 SFSPL CFSPL 10,000 15-Dec-08 SFSPL CFSPL 30,000

17-Dec-08 ACPL CFSPL 30,000 17-Dec-08 KLFPL CFSPL 27,500 19-Dec-08 JIPL CFSPL 67,500 24-Dec-08 ACPL CFSPL 40,000 24-Dec-08 ACPL CFSPL 17,500 24-Dec-08 CFSPL SFSPL 40,000 30-Dec-08 SFSPL VBAPL 40,000

Table-IIIIII ''MMaarrkkeett'' TTrraannssaaccttiioonnss::

Trade Buy Client Buy Member Sell Member Sell Client QQuuaannttiittyy Date Name Name Name Name 5-Dec-08 JIPL CJ Dalal Krishvi ACPL 1122,448855 8-Dec-08 MSL Krishvi CJ Dalal JIPL 1122,550000 10-Dec-08 CFSPL CJ Dalal Krishvi MSL 1122,449966 11-Dec-08 ACPL Krishvi CJ Dalal CFSPL 1122,550000 11-Dec-08 MSL CJ Dalal Lalkar CFSPL 1100,000000 11-Dec-08 ACPL Krishvi CJ Dalal MSL 1100,000000 15-Dec-08 ACPL Krishvi Lalkar CFSPL 3300,000000 15-Dec-08 KLFPL Krishvi CJ Dalal ACPL 2277,550000 17-Dec-08 JIPL Krishvi Lalkar CFSPL 5577,550000 17-Dec-08 JIPL CJ Dalal Lalkar CFSPL 1100,000000 19-Dec-08 ACPL Krishvi Lalkar CFSPL 6677,550000 24-Dec-08 MSL CJ Dalal Lalkar CFSPL 1177,550000 29-Dec-08 CFSPL Krishvi CJ Dalal MSL 1177,550000

7.5.1 TThhee aabboovvee ttrraaddeess aarree ppiiccttoorriiaallllyy pprreesseenntteedd aass uunnddeerr::-

7.5.2 FFrroomm tthhee aabboovvee ttrraannssaaccttiioonnss, iitt iiss nnootteedd tthhaatt on December 8, 2008, VBAPL//PPrroommootteerr of Temptation transferred 33,1100,000000 sshhaarreess of Temptation in off–mmaarrkkeett ttoo SSFFSSPPLL.

Subsequently, out of the said 3,10,000 shares received from VBAPL, SFSPL transferred 10,000 shares and 30,000 shares on December 11, 2008 and December 15, 2008 respectively to CFSPL in off-market. CFSPL, on December 11, 2008 sold 10,000 shares to MSL; MSL, inturn sold these shares to ACPL. ACPL sold 27,500 shares of Temptation to KLFPL on December 15, 2008. KLFPL transferred the 27,500 shares to CFSPL through off-market. CFSPL on December 15, 2008 sold 30,000 shares to ACPL; ACPL then transferred these shares off market to CFSPL on December 17, 2008. CFSPL, who has received 57,500 shares in off market (i.e. 30,000 shares from ACPL and 27,500 shares from KLFPL) on December 17, 2008, sold these shares to JIPL on the same day. It is noted that JIPL then transferred these shares (67,500 shares) back to CFSPL through off market on December 19, 2008. CFSPL then sold these shares to ACPL on the same day. ACPL then transferred 40,000 shares off market to CFSPL then to SFSPL and finally back to VBAPL. Therefore, a clear pattern of circular trading is evident in the trades amongst the aforementioned clients, viz; CFSPL, KLFPL, JIPL, MSL, ACPL and SFSPL (off-market) in a pattern:- A to B to C to D back to A. It is noted that the 40,000 shares transferred by VBAPL to SFSPL were also deployed to create artificial volumes through circular transaction of shares, as narrated above, by the connected entities,.

7.5.3 From the above, I observe that there were repeated instances of circular trading over a period of time amongst connected clients. In the facts and circumstances of this case, both "market" as well as "off-market" transactions need to be taken into account to understand the nature of the transactions. I also observe that these entities have transferred shares in "off-market" only to camouflage the nature of circular transactions by attempting to break the chain of circular transfer of shares of Temptation in 'market' transactions. In view of the aforesaid facts and circumstances, it is evident that the shares and funds transferred by VBAPL to connected entities were also utilized to create artificial volumes in the scrip of Temptation. Therefore, it can be concluded that VBAPL has actively facilitated the aforesaid entities connected to it, in creating the artificial volume in the scrip of Temptation by way of the circular trades described above.

8. In view of the observations and findings as detailed in the aforesaid Paragraph No. 7, I find that VBAPL; the promoter entity of Temptation, transferred funds and shares of Temptation to connected entities, which were utilized to create artificial volumes in the scrip by carrying out reversal and circular trades. Thus, VBAPL aided and abetted connected entities to create a false and misleading appearance of trading in the scrip of Temptation. Mr. Vineet Kumar is the director of VBAPL and was in charge and responsible for the business of VBAPL and is, therefore, liable and responsible for all the acts and commissions of VBAPL. The aforementioned fraudulent and deceptive practice of creating false and misleading appearance of trading in Temptation perpetrated by the noticees, are in violation of Regulations 3(a), (b), (c) and (d) and 4(1), 4(2) (a), (d) and (g) of the PFUTP Regulations and Section 12A(a), (b) and (c) of the SEBI Act, 1992.

9. It is observed from the material available on record that a winding up order has been passed against VBAPL by the Hon'ble High Court of Judicature at Bombay vide its order dated July 13, 2012 in Company Petition No. 288 of 2010. Section 446 of the Companies Act, 1956, deals with stay of suits, etc., on winding up Order. Section 446(1) of the Companies Act, 1956 read as under:

"When a winding up order has been passed or a provisional liquidator has been appointed, no suit or other legal proceeding shall be commenced, or if pending at the date of the winding up order, shall be proceeded with, by or against the company, except with the leave of the Tribunal and subject to such terms as the Tribunal may impose: "

9.1 Section 446 is intended to safeguard the company's assets against wasteful or expensive litigation in regard to matters which are capable of determination more expeditiously and cheaply by the Tribunal and also the proceedings which come under the ambit of Section 446 are for the enforcement of something in the nature of personal right against the assets of the company. In this context, it is noted that the directions contemplated under this order shall not in any way have an effect on the assets and properties of VBAPL.

10. VBAPL was prohibited from accessing the securities market and further prohibited from buying, selling or dealing in securities market, directly or indirectly, till further orders, vide ad interim ex parte Order dated June 4, 2009 (later confirmed through the Confirmatory Order dated June 30, 2010). VBAPL has already undergone the prohibition for almost five years. It is noted that name of Mr. Vineet Kumar; the Director of VBAPL, was neither included in the aforesaid interim order nor in the subsequent confirmatory order passed against VBAPL.

11. In view of the foregoing, I, in exercise of the powers conferred upon me by virtue of Section 19 read with Section 11 and 11B of the SEBI Act, 1992 and Regulation 11 of the PFUTP Regulations, 2003, hereby - i. restrain, Venture Business Advisors Pvt. Ltd., from accessing the securities market and further prohibit it from buying, selling or dealing in securities market, directly or indirectly, for a period of 10 years. The period of prohibition already undergone by VBAPL pursuant to the SEBI's ad interim ex parte Order dated June 4, 2009 shall be taken into account for the purpose of computing the 10 years of prohibition imposed in this Order.

ii. restrain, Mr. Vineet Kumar; the Director of Venture Business Advisors Pvt. Ltd., from accessing the securities market and further prohibit him from buying, selling or dealing in securities market, directly or indirectly, for a period of 5 years from the date of this Order as Mr. Vineet Kumar was not covered in the aforesaid interim Order dated June 4, 2009 passed by SEBI.

12. This Order shall come into force with immediate effect.

13. The copy of the said Order shall be forwarded to the concerned Stock Exchanges and Depositories.

Place: Mumbai S. RAMAN Date: August 20, 2014 WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA