Order in the matter of dealings in the shares of P.M. Telelinnks Ltd. and 8K Miles Software Solutions Ltd

WTM/RKA/ISD/59/2013 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA ORDER Under sections 11(1), 11(4) 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. In the matter of dealings in the shares of P.M. Telelinnks Ltd. and 8K Miles Software Solutions Ltd. In respect of (1) Mr. Jipal Pineshkumar Shah (PAN - BMWPS2515R), (2)Mr. Saurin Pravinbhai Shah (PAN - BKYPS3545K), (3) Ms. Bhavini Vijaykumar Shah (PAN - CDAPS8340A), (4) Mr. Vijay Babulal Shah (PAN - AOMPS1703C), (5) Mr. Jagdish Ramanalal Patel (PAN - AAWPP0600R), (6) Mr. Pankaj N. Patel (PAN - AAWPP0599D), (7) Mr. Ronak P. Patel (PAN - ATKPP2021M), (8) Ms. Urmila G. Patel (PAN - ATKPP2887M), (9) Ms. Hema G. Patel (PAN - AQGPP6610B), (10) Mr. Daivik Jatinbhai Shah (PAN - BXYPS2715J) (collectively referred to as the ‘Shah/Patel Group’) and (11) Gulab Chand Pukhraj Surana (AINPS9082R), (12) Dipin Surana (AINPS9083Q) (13) Ravi Pukhraj Surana (AINPS9085J) (collectively referred to as the ‘Promoter Group’). Appearances: For Shah/Patel Group: 1. Mr. J.J. Bhatt, Advocate 2. Ms. Rinku Smitesh Valanju, Advocate 3. Mr. Nimit Gandhi, Advocate

For Promoter Group: 1. Prashant V. Ingle, Advocate

For SEBI: 1. Mr. Santosh Kumar Shukla, Joint Legal Adviser 2. Mr. K. Saravanan, Deputy General Manager 3. Ms. Amy Durga Menon, Assistant General Manager 4. Mr. Durgesh Kumar Thakur, Assistant Legal Adviser 5. Mr. Abhiraj Arora, Legal Officer 1. Securities and Exchange Board of India (SEBI) received alerts from its Surveillance System relating to dealings in the shares of P.M. Telelinnks Ltd. (hereinafter referred to as 'PMTL') on the BSE. It was observed that during the period August 1, 2011 to May 23, 2012, the price of the scrip moved up from ₹ 39.95 per share to ₹ 182.8 per share, i.e., a price rise of around 358%. Thereafter, the scrip witnessed a gradual fall in its price from ₹ 182.8 per share on May 23, 2012 to ₹ 154.10 on July 13, 2012, followed by a sharp fall from ₹154.10 on July 13,

2012 to ₹ 41.40 on August 6, 2012 i.e., a price fall of 73.13 %. The price further declined to ₹ 30.25 per share on September 17, 2012. SEBI also observed similar price movement and pattern of dealings in the scrip of 8K Miles Software Solutions Ltd. (8KMILES). 2. In the above background, SEBI, vide an ad interim ex-parte order dated April 18, 2013, restrained Jipal Pineshkumar Shah, Saurin Pravinbhai Shah, Bhavini Vijaykumar Shah, Vijay Babulal Shah, Jagdish Ramanalal Patel, Pankaj N. Patel, Ronak P. Patel, Urmila G. Patel, Hema G. Patel, Daivik Jatinbhai Shah, Gulab Chand Pukhraj Surana, Dipin Surana and Ravi Pukhraj Surana (collectively referred to as "the noticees") from accessing the securities market and further prohibited them from buying, selling or dealing in securities in any manner whatsoever, till further directions. 3. Pursuant to the aforesaid interim order, Jipal Pineshkumar Shah and Jagdish Ramanlal Patel filed the replies on behalf of Shah/Patel Group. Later, Shah/Patel Group requested not to take cognizance of their earlier replies. The entities of Promoter Group did not file their replies. 4. Opportunity of personal hearing was granted to the noticees on July 18, 2013 which was adjourned to August 21, 2013 on their request. On the said date, Ms. Rinku Smitesh Valanju, advocate appeared for Shah/Patel Group and requested for documents relied upon while passing the interim order, which was provided to them vide letter dated September 05, 2013. Vide letter dated August 19, 2013 the Promoter Group sought another date of personal hearing. Accordingly, all the noticees were granted another opportunity for personal hearing on September 25, 2013, which was later rescheduled to October 14, 2013, on their request. On October 14, 2013, advocates of the noticees appeared and made submissions. The noticees also filed their written arguments pursuant to the personal hearing. The noticees have raised the following common preliminary contentions :

a) The power to issue directions under section 11(1), 11(4) and 11(B) of SEBI Act, is a drastic power having serious civil consequences and ramifications on the repute and livelihood of those against whom it is directed. Said power is not available for routine and retrospective application and cannot be used for penal action. It is exceptional, extraordinary and discretionary power and SEBI has to justify the need for invocation of the said power clearly after about 6 months from the alleged cause of action.

b) The interim order is vitiated by gross violation of principles of natural justice, in as much as no opportunity was provided to explain their version and hence the order is bad in law. 5. Submission of Shah/Patel Group - The Shah/Patel Group entities have inter alia submitted as under:

a) They do not come under SEBI’s jurisdiction for the purpose of section 11(1),11(4) and 11B of SEBI Act. b) They have not received the following documents: i. Copy of full Investigation Report; ii. Copy of order log; iii. Copy of documents / information / material relied upon by SEBI to infer relation / connection with other entities. c) They are retail investors, trading in different scrips independently and during the investigation period have traded in shares of other companies also. d) The very basis of formation of Shah/Patel Group is faulty and there was no intention on their part to act in any group as alleged or otherwise. e) The telephone numbers i.e., 9978834974 / 9825011486 as alleged in the interim order do not belong to them. They are not aware as to who filled in/ provided the said telephone number in KYC to the broker. The broker had not provided them the KYC documents at the time of account opening, otherwise they could have raised an objection to the same. The inference drawn by SEBI on this count is without any cogent basis. f) M/s. P.M. Telecom had transferred to Daivik Shah and Saurin Shah an amount of ₹ 10 lacs and ₹ 100 lacs, respectively, in terms of loan cum guarantee agreement which carried an interest rate of 10% per annum and was repayable after a period of 24 months.

Daivik Shah had repaid ₹ 8 lacs and the balance amount would be repaid. g) Gulabchand Pukhraj Surana had transferred 2,50,000 shares of PMTL to Jagdish Patel. The transfer was shown for consideration; however, as he has no funds to pay for the same, he has decided to return shares through off-market. h) The figures shown in table no 4 of interim order with respect to their percentage of concentration is erroneous. i) In the scrip of PMTL, it has been alleged that out of 1,72,08,065 shares traded by the Shah/Patel Group entity, they have traded about 42,16,966 (9.71% of market volume) in a synchronized manner. Hence total objectionable volume is only about 9.71 %. j) Their respective trading volumes in the scrips of PMTL and 8KMILES are not significant when compared with total traded volume of the respective scrips. Further, they were still holding shares of PMTL in their demat accounts, at the time of passing the interim order. k) The justification / assumption in the order viz. “artificial increase in price of the scrips do not appear to be supported by fundamentals of the companies” is erroneous as price of scrip depends on several factors / forces and influences and not only on the fundamentals of the companies. l) They have not indulged in any price manipulation activity by trading at Last Traded Price (LTP) variation and that their orders were keyed in within permissible price limits.

The impact on the price rise of the shares of PMTL or 8KMILES if any, was normal and not manipulative as alleged. m) First trades at higher than previous closing market price is not against any trading regulation and since the quantity of such trades was miniscule, were stray / erratic trades, they do not accept the inference that the intention was to increase the price of the scrip in case of trades involving small quantities of shares. n) Further, on account of not having provided complete data, they cannot be called upon to explain the case in violation of principles of natural justice. o) They have not indulged in group trades or self trades or price manipulation. p) The market price of 8KMILES got corrected on account of bonus shares and that it cannot be said that the entities have contributed to increase/decrease of the share price. q) They have not violated provisions of regulations 3(a) and (b), 4(1) and (2) (a), (b) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 (PFUTP Regulations) and section 12(A) (a), (b) and (c) of the SEBI Act as alleged or otherwise. r) The charges leveled against them be dropped and any direction under section 11 and 11B of SEBI Act read with regulation 11 of PFUTP Regulations 2003 should not be issued against them in the interest of justice. 6. Submission of Promoter Group- The Promoter Group inter-alia made the following submissions:

a) ₹ 10 lacs and ₹ 100 lacs were transferred as loan to Daivik Shah and Saurin Shah, respectively in the normal course of business. No adverse inference should be drawn based on the aforesaid funds transfer. Daivik Shah has repaid the loan in full while Saurin Shah has repaid ₹ 5 Lakhs. b) 2,50,000 shares of PMTL was transferred to Jagdish Patel through off-market as they were in need of money and at that relevant time the value of these shares were around ₹ 62.5 Lacs. c) The fund and off market transfers were strictly at arm's length. At the relevant time they were not aware of the end use of the shares or the funds (subsequent transfers etc) in the hands of respective parties and had also no role to play or had any control over the same. d) The fact that they did not sell even a single share during the alleged price rise period totally destroys any implication of them being involved in the trading of Shah/ Patel Group in any manner. e) The trade log provided to them with respect to their trading in 8KMILES is vague and incomprehensible; the same is not in the standard format. They requested SEBI to provide trade log in the standard format to file further submissions.

f) They have not executed any synchronised trades as alleged since their trading was through stock exchanges wherein it is not possible to know the identity of the counter party broker or client. g) The non-disclosure of Dipin Surana's shareholding in PMTL for the quarter ending December 31, 2011, March 31, 2012 and September 30, 2012, was a technical lapse on the part of the secretarial staff. There was no intention to conceal the information as it was already in the public domain on stock exchanges. h) They have not violated section 12A (a), (b) and (c) of SEBI Act and regulations 3(a), 3(b), 4(1), 4(2)(a) and 4(2)(b) of the PFUTP Regulations as alleged. i) Further, the charges in the interim order be dropped and direction issued against them, restraining them from accessing the securities market and prohibiting them from buying, selling or dealing in the securities market, directly or indirectly till further orders be lifted. 7. I have carefully considered the allegations and the submissions of the noticees. Before dealing with submissions of the noticees on merit, I deem it necessary to deal with their preliminary contentions. With regard to the first such contention of the noticees i.e. scope and ambit of powers of SEBI under section 11(1), 11(4) and 11(B) of SEBI Act, I note that the scheme of the SEBI Act is very clear. To understand the legislative scheme of the SEBI Act, it is pertinent to mention the relevant provisions which are as under: Functions of Board. 11. (1) Subject to the provisions of this Act, it shall be the duty of the Board to protect the interests of investors in securities and to promote the development of, and to regulate the securities market, by such measures as it thinks fit. ………………………….. [(4) Without prejudice to the provisions contained in sub-sections (1), (2), (2A) and (3) and section 11B, the Board may, by an order, for reasons to be recorded in writing, in the interests of investors or securities market, take any of the following measures, either pending investigation or inquiry or on completion of such investigation or inquiry, namely:— (a) suspend the trading of any security in a recognised stock exchange; (b) restrain persons from accessing the securities market and prohibit any person associated with securities market to buy, sell or deal in securities; ………………………………..

Power to issue directions. 11B. Save as otherwise provided in section 11, if after making or causing to be made an enquiry, the Board is satisfied that it is necessary,— (i) in the interest of investors, or orderly development of securities market; or (ii) to prevent the affairs of any intermediary or other persons referred to in section 12 being conducted in a manner detrimental to the interest of investors or securities market; or iii) to secure the proper management of any such intermediary or person it may issue such directions,— (a) to any person or class of persons referred to in section 12, or associated with the securities market; or (b) to any company in respect of matters specified in section 11A, as may be appropriate in the interests of investors in securities and the securities market.]

8. I note that the above provisions are unambiguous with respect to SEBI’s power to issue interim as well as final directions. Considering the objectives and guiding principles envisaged in those provisions such directions can be issued inter alia for investor protection and to maintain the integrity of the market. In this regard, it is noted that the scope of power of SEBI, to issue interim directions under the aforesaid provisions has been settled by various courts and Securities Appellate Tribunal (SAT). For instance, Hon'ble Bombay High Court in Ramrakh R. Bohra v. SEBI [1999] 96 Comp Cas 623 (Bom) has very clearly upheld powers of SEBI to pass interim oreder in following words:- “Section 11B is an enabling provision enacted to empower SEBI to protect interest of investors and to promote the development of and to regulate the securities market and to prevent malpractices and manipulations inter alia by brokers. Such an enabling provision must be construed so as to subserve the purpose for which it is enacted. It would be the duty of the court to further the legislative object of providing a remedy for the mischief. A construction which advances this object should be preferred rather than one which attempts to find a way to circumvent it. The said power to issue directions under Section 11B must carry with it, by necessary implication, all powers and duties incidental and necessary to make the exercise of these powers fully effective including the power to pass interim orders in aid of the final orders. The provision of Section 11B it is to be noted has been introduced by an amendment brought about in 1995 and the same seeks to confer additional power on the board, by way of interim measures, pending inquiry. The same is intended for the protection of the interests of the investors and the securities markets.”

9. Further in the matter of Anand Rathi & Others Vs. SEBI (2002 (2) Bom CR 403, Hon'ble Bombay High Court has upheld the powers of SEBI to pass such orders under sections 11 and 11B of the SEBI Act as under:- “ While considering the question as to whether the SEBI has authority of law under Sections 11 and 11B to order interim suspension, we have to bear in mind that SEBI is invested with statutory powers to regulate securities market with the object of ensuring investors protection, orderly and healthy growth of securities market so as to make SEBI's control, over the capital market to be effective and meaningful. It cannot be gainsaid that SEBI has to regulate speculative market and in case of speculative market varied situations may arise and looking into the exigencies and requirements, it has been entrusted with the duty and functions to take such measures as it thinks fit. Section 11B is an enabling provision enacted to empower the SEBI Board to regulate securities market in order to protect the interest of the investors. Such an enabling provision must be so construed as to subserve the purpose for which it has been enacted.

It is well settled principle of statutory construction that it is the duty of the Court to further Parliament's aim of providing of a remedy for the mischief against which enactment is directed and the Court should prefer construction which will suppress the mischief and advance remedy and avoid evasions for the continuance of the mischief.” 10. Hon’ble SAT also in Karvy Stock Broking Ltd. Vs. SEBI. Appeal No.92/2006 held as under: "The introduction of sub section (4) in section 11 and various other provisions like section 11B is indicative of the legislative intent. These provisions are meant to arm the Board with authority so as to be able to effectively exercise power and achieve the declared objectives of the Act. …… ..………………………………………………………………………… We cannot lose sight of the fact that the Board has to regulate a speculative market and in such a market varied situations may arise all of which cannot be envisaged and there may be an urgent need to pass an order even when an inquiry or investigation is pending. …………….. On an examination of the provisions as noticed above, we find that the legislative scheme is clear.

The provisions of the Act are basically intended to protect the interests of the investors and to promote the market. However, the Act as initially enacted provided primarily for taking promotional or protective measures. The power to take preventive or punitive measures was implicit………………………… ……………………………………………………………………………………… Now it has been expressly extended to taking even the preventive or punitive measures. Without doubt, these, too, are ultimately aimed at achieving the basic objectives of investor protection and promotion of the development and regulation of the securities market as contained in the preamble. ………………………………………………………………………………………… …….. In view of the above, we hold that the word ‘inquiry’ used in section 11(4) refers to the inquiries held under sections 11, 11B, also to the enquiry under the inquiry regulations framed under section 12(3) and also to the inquiry held under Chapter VIA and it is during the pendency of any of these inquiries that an interim order could be passed with a view to protect the interests of investors or in the interest of the market."

11. It may also be noted that the above referred provisions do not stipulate time limit as suggested by the noticees. Considering the nature of securities markets, transactions conducted and stakes involved therein, any time limit as suggested by the noticees would, in my view, defeat the purpose for which such power is conferred. On careful reading of the provisions of the SEBI Act and the position settled in the above judgements it is clear that the power of SEBI to pass interim orders is not limited as sought to be contended by the noticees. 12. I further note that there is no violation of principles of natural justice in the present matter while passing the interim order as contended by the noticees. The interim order has been passed on the basis of prima facie findings observed during the preliminary examination/inquiry undertaken by SEBI. The facts and circumstances necessitating issuance of directions by the interim order has been examined and dealt with in the said interim order. The interim order has also been issued in the nature of show cause notice affording the noticees a post decisional opportunity. In this regard, it is relevant to mention the judgement of Hon'ble Bombay High Court in Anand Rathi & Others Vs. SEBI (2002 (2) BomCR 403 wherein it upheld the procedure of post decisional hearing in such matters and observed as under: "31. It is thus clearly seen that pre decisional natural justice is not always necessary when ad-interim orders are made pending investigation or enquiry, unless so provided by the statutes and rules of natural justice would be satisfied if the affected party is given post decisional hearing. It is not that natural justice is not attracted when the orders of suspension or like orders of interim nature are made. The distinction is that it is not always necessary to grant prior opportunity of hearing when ad-interim orders are made and principles of natural justice will be satisfied if post decisional hearing is given if demanded."…

13. As regards the contentions of the entities of Shah/Patel Group that they do not come under SEBI’s jurisdiction for the purpose of section 11(1), 11(4) and 11B of SEBI Act, I note that prohibitions under section 12A and regulations 3 and 4 of PFUTP regulations extend to any ' person'. Accordingly, an investor/trader like the noticees in this case is also prohibited from directly/indirectly indulging in the activities prohibited under the provisions of said sections and regulations. The power to issue directions under section 11 and 11B is also available with regard to 'any person associated with securities market'. The noticees being investors/traders in the securities market are, in my view, undoubtedly covered under the expression 'any person associated with securities market'. In this regard, it is relevant to refer to the judgement of Hon'ble Gujarat High Court in the case of Karnavati Fincap Ltd. & Ors. vs SEBI wherein it has been held that: " The words "persons associated with the securities market" are of much wider import than intermediaries. “Persons associated with" denotes a person having connection or having intercourse with the other; in the present case that "other" with whom a person is to have connection or intercourse is the securities market. ……………………………………………………………………………………..

All activities of business of selling and buying are related to the seller or the buyer. It is inconceivable to think that a buyer or seller of a scrip is not a person associated with the securities market, where or through which he transacts his business, whether as trader or as investor, of selling or buying the required scrip.”

14. With regard to the preliminary contention of Shah/Patel Group entities that they have not been provided with certain documents, I find that in the present matter the interim order has been passed on the basis of prima facie observations found during preliminary inquiry and the investigation in the matter is in progress. The findings of any investigation report are not the basis of any interim order. Further, the order log has also not been relied upon in the interim order. Therefore, question of furnishing findings of investigation report and order log does not arise. I further note that KYC information of the noticees and fund transfer amongst them is the basis for the relationship/connection amongst them. I note that the bank account statements and KYC information are the Shah/Patel Group entities' own documents that are available with banks, depositories and exchanges. I note that the copy of their bank account statement has been provided to the Shah/Patel Group entities'. The KYC information which has been gathered in the SEBI's surveillance system on the basis of information provided by them to exchanges and depositories has been included in the interim order. I therefore find that there is no infirmity in the proceedings, if the KYC information of Shah/Patel entities is not provided to them. 15. I further note that the Shah/Patel Group entities have also questioned the accuracy of the data regarding their concentration in the scrip of PMTL vis-à-vis their trading across the market. I find this contention vague and general and I, therefore, reject the same.

16. With regard to the contentions of the Promoter Group that the trade log provided to them is not in standard format, I note that all the relevant the information of the imougned trades as available with SEBI have been provided to them. In my view specific format suggested by them is immaterial and not providing the information in that particular format will not vitiate the proceedings since substance thereof is already provided. I, therefore, find this contention of the Promoter Group baseless. 17. In view of the above, I find that the noticees' preliminary contentions are devoid of any merit. 18. I now proceed to deal with submissions of the noticees on merit. I have carefully considered the allegations in the interim order in respect of noticees and their submissions. The limited issue to be considered in this order is as to whether, the directions issued vide the interim order need to be continued, revoked or modified in any manner. 19. The Shah/Patel Group entities have contended that the telephone numbers (978834974/9825011486) mentioned in the interim order do not belong to them.

They have further submitted that they are not aware, as to who provided the said numbers for their KYC requirements to the broker. Further, their broker had not provided them the KYC documents at the time of account opening. I note that, the KYC documents are provided by the clients themselves to stock brokers/depository participants. The stock broker does not provide the KYC documents of the clients to them as sought to be contended by the Shah/Patel Group entities. I further note that these entities have not disputed the other factors that have been considered as basis of connection/ relation viz. transfer of funds and shares inter-se amongst them. 20. Admittedly, Gulabchand Pukhraj Surana of the Promoter Group had transferred 2,50,000 shares of PMTL to Jagdish Patel (of Shah/Patel Group) on June 28, 2011 through off-market transaction. This fact is further corroborated by the submissions of Jagdish Patel that since he had no funds to pay for those shares he decided to return those shares through off-market. Thus, the said off-market transfer considered in the interim order as basis of determining connection between Promoter Group and Shah/Patel Group is established.

I further, note that while Gulabchand Pukhraj Surana has claimed that he did this off-market transaction as he needed urgent money, the transferee i.e. Jagdish Patel has claimed that he did not have money to pay for those shares and had decided to return those shares to the transferor i.e. Gulabchand Pukhraj Surana. I note that the transaction was done on June 28, 2011 and the interim order was passed on April 18, 2013, however, the shares were not returned by the transferee to the transferor in that transaction even though sufficient time had elapsed after the date of transaction. In my view, under normal commercial transactions, no person would sell such huge quantity of shares, as in this case, to another person without receiving any consideration and no transferee would retain the shares, when no consideration has been paid for shares bought by him. In my view, these submissions of Gulabchand Pukhraj Surana and Jagdish Patel appear to be an afterthought.

21. Daivik Shah and Saurin Shah (of Shah/Patel Group) have admitted that they received ₹ 10 lacs and ₹ 100 lakhs, respectively from M/s P. M. Telecom (related entity of the Promoter Group) under a loan -cum -guarantee agreement. Promoter Group has claimed that Daivik Shah has repaid the loan in full and Saurin Shah has repaid ₹ 5 Lakhs. However, Daivik Shah has submitted that he has repaid only ₹ 8 lacs and Saurin Shah has not mentioned about refund amount. These submissions are apparently contradictory and suggest an afterthought of the noticees. Nevertheless, such transfer considered as basis of connection/ relation amongst the Promoter Group and Shah/Patel Group in the interim order is established. I further find that the noticees have failed to refute the findings of the interim order that the funds so received by Saurin Shah from the Promoter Group was distributed among the other entities of the Shah/Patel Group, which again was utilised for their pay-in obligations as described in the interim order. I, therefore, do not find any reason to hold anything contrary to the findings in the interim order.

22. The allegation against the noticees in the interim order is that they had acted as a group, traded amongst themselves, executed synchronised trades and placed orders at a price higher than the last traded price (LTP) in scrip of PMTL and 8KMILES. I note that the noticees have not disputed their transactions as alleged but have rather contended that their trades are independent in nature. I further note that noticees submitted their individual trading volumes in comparison to total trade volume in both the scrips to create an impression that the volume of trades is not significant. I find that trading at LTP variation and synchronised trades are not illegal per se; however considering the relationship between the entities of the Shah/Patel Group with the Promoter Group, the activities of the noticees need to be viewed in totality which has been duly considered in the interim order. I prima facie find that the concerted trading amongst the connected /related entities of Promoter Group and Shah/Patel Group in both the scrips had led to creation of artificial volume and unnatural increase in price of the scrips as found in the interim order.

23. I note that, at this stage, noticees have failed to give any plausible reasoning/explanation for their acts as dealt with in the interim order and have not been able to make out a prima facie case for revocation or modification of the interim order. I also note that investigation in the matter is going on and appropriate decision, in accordance with law, would be taken after completion thereof. In this case, it has been inter alia found in the interim order that the Promoter Group and the Shah/Patel Group acting in concert, indulged in fraudulent and manipulative trading by way of trading amongst themselves without intending to transfer the beneficial ownership of shares traded, trading at prices above LTP, etc. thereby creating unnatural and artificial volumes in the scrips of PMTL and 8KMILES and manipulated their prices. Their fraudulent and manipulative trading contributed to 40.75% and 42.92% of the gross market volume in the scrips of PMTL and 8KMILES respectively. Further, their actions have also resulted in increase of the price of scrip of PMTL from ₹39.95/- per share to ₹182.80/- per share and the price of scrip of 8KMILES increased from ₹41.95/- per share to ₹64.60/- per share.

Once the price of the scrip reached its peak, the Shah/Patel Group offloaded their shares, thereby resulting in fall in the price of these scrips. In this case, the charge of fraudulent, manipulative dealings against the noticees is on the basis of repeated transaction in two scrips simultaneously with connivance of then management of the respective companies. As prima facie found in the interim order, the concerted tradings of the connected entities under a premeditated plan or strategy of 'pump and dump' not only erode the market integrity but also are detrimental to the interests of investors who might have been lured to invest the scrips due to such manipulative and fraudulent trading in the scrips and price movement trend. In my view, the facts and circumstances of the case justify the continuation of the directions passed against them under the interim order dated April 18, 2013 and no intervention is called for, at this stage, in either vacating the interim directions or modifying them.

24. I, therefore, in exercise of the powers conferred upon me under section 19 of the SEBI Act, read with sections 11(1), 11(4) and 11B thereof, hereby confirm the directions issued vide the ad interim ex-parte order dated April 18, 2013 against the following entities.

Sr. no. Name of the entity PAN 1 Jipal Pineshkumar Shah BMWPS2515R 2 Saurin Pravinbhai Shah BKYPS3545K 3 Bhavini Vijaykumar Shah CDAPS8340A 4 Vijay Babulal Shah AOMPS1703C 5 Jagdish Ramanalal Patel AAWPP0600R 6 Pankaj N. Patel AAWPP0599D 7 Ronak P. Patel ATKPP2021M 8 Urmila G. Patel ATKPP2887M 9 Hema G. Patel AQGPP6610B 10 Daivik Jatinbhai Shah BXYPS2715J 11 Gulab Chand Pukhraj Surana AINPS9082R 12 Dipin Surana AINPS9083Q 13 Ravi Pukhraj Surana AINPS9085J

25. Accordingly, the directions issued vide para 23 of the interim order dated April 18, 2013 shall remain in force till further directions.

26. A copy of this order shall be served on all recognized stock exchanges and depositories to ensure compliance with above directions.

DATE: December 30th, 2013 RAJEEV KUMAR AGARWAL PLACE: MUMBAI WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA