Order in the matter of Exelon Infrastructure Limited[SAT Appeal No.:325/2016,324/2016,323/2016,322/2016,321/2016,320/2016,319/2016,318/2016]

WTM/SR/EFD–DRA–I/46/09/2016 BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA, MUMBAI CORAM: S. RAMAN, WHOLE TIME MEMBER ORDER UNDER SECTIONS 11(1), 11(4) AND 11B OF THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992. IN THE MATTER OF EXELON INFRASTRUCTURE LIMITED – IN RESPECT OF – 1. EXELON INFRASTRUCTURE LIMITED [PAN: AAACM2862M]. 2. CEMENTEX (INDIA) PRIVATE LIMITED [PAN: AAACC9265A 3. MR. SRINIVASA RAO MARUPUDI [PAN: ACQPM0876L; BCDPM3124P]. 4. MR. GADDE BUTCHI TIRUPATI RAO [PAN: AHUPG9920A]. 5. MR. RAVI CHAKRAVATI [PAN: AJXPR4789F]. 6. MR. M. VISHNUVARDHAN RAO [PAN: ABYPM0993M]. 7. MR. P R K VENKATAMURTHI [PAN: AFQPP6066G]. 8. MR. SRINIVAS YADAV SHER [PAN: AUAPS8547G]. 9. MR. SHAIK AMEER BASHA [PAN: AEZPB3408A]. 10. MR. SREE LAKSHMI MARUPUDI [PAN: ALYPM2964Q]. 11. MR. HITEN VALLABHJI HARIA [PAN: AAAPH6890H]. 12. A. K. INVESTMENTS [PAN: AANFA6009Q]. 13. MR. NARENDRA OMPRAKASH DOGRA [PAN: AJMPD8729N]. 14. MR. KANTA ANANTRAI DESAI [PAN: AAEPD6006F]. 15. MR. ANJALI TUKARAM SOGAM [PAN: CGNPS1443N]. 16. MR. JITENDRA L. GANDHI [PAN: AACPG6473H]. 17. SHRI AMRIT L. GANDHI [HINDU UNDIVIDED FAMILY] [PAN: AAJHA4701R]. 18. MR. GANGADHARA RAO ILAPARTI [PAN: AANPI9650F]. 19. MR. HUSSAIN MOHAMMED SHAIKH [PAN: BSSPS2832P]. 20. MR. JIGNA MANISH SHAH [PAN: ANQPS6789P]. 21. MRS. SNEHA PANKAJ DESAI [PAN: AIBPD1454A]. 22. MR. NISHITA DANISH MERCHANT [PAN: AMHPM8133B]. 23. DHANA ENERGY PRIVATE LIMITED [PAN: AACCV7693M]. 24. MR. SRIKRISHNA VADLAMUDI [PAN: ADNPV5504C]. 25. MR. KANTILAL LAKSHMICHAND [PAN: ADSPK7577K]. 26. MR. GUDIMETLA H SUNDER [PAN: BMLPS9664N]. 27. MS. SHIVANGI JAGMOHAN SINGH [PAN: AOSPS5911E]. 28. MS. DIMPLE PANKAJ DESAI [PAN: AUQPD3909F]. 29. MR. PVS GANGADHARA RAO [PAN: AKYPP5600M]. 30. MR. SUNIL KUMAR H. PAL [PAN: BKSPP6938B]. 31. MR. VENKATA SUBBARAO YARRA [PAN: AAPPY4270P]. 32. SHRI AMRIT L. GANDHI [PAN: AACPG5265H]. 33. MRS. BHAVNABEN NIMESHBHAI MISTRY [PAN: ALIPM5347B].

34. MR. YENTRAPATI RAVI [PAN: ABWPY6767F]. 35. MS. PARUL ANUPAM KHANNA [PAN: BCUPK8420R]. 36. MR. HITEN P. SHAH [PAN: AHAPS0889A]. 37. MS. PARVATHANENI MOUNISHA [PAN: BAOPP1399G]. 38. MS. SWAPNA SRI TUMMALA [PAN: ALDPT7720Q]. 39. MR. SATYA SURYA NARAYANA JONNAVITTULA [PAN: ACRPJ9665R]. 40. MR. PIYUSH NARESH KOTHARI [PAN: AEOPK1882L]. 41. MR. NRUPINI JAYESH MEHTA [PAN: BDTPM2261E]. 42. MR. MAHENDRA BHIKAJI CHILE [PAN: AHNPC8127G]. 43. MR. ELUBANDI SATYANARAYANA [PAN: DGCPS7022F]. 44. MR. RAMA KRISHNA MAKKENA [PAN: BCKPK1101P]. 45. MS. ANITHA YARLAGADDA [PAN: ACAPY5774B]. 46. MS. SALMA SHARAFAT KHAN [PAN: BVSPK9348F]. 47. MS. SEEMA GANDHI [PAN: AAEPG0960B] 48. MR. RONAK ASHWIN CHOKSI [PAN: ADDPC2938D]. 49. MR. VEERABHADRA DANDAMUDI [PAN: ABVPD6656R]. 50. MR. DIVYESH HARISH SURANA [PAN: DALPS0578H]. 51. MR. JAYESH HIMATLAL MEHTA [PAN: AIFPM2216D]. 52. MR. SHIVCHARAN SHREEDHAR KASHYAP [PAN: ATOPK6636K].

Background –

1.1 Exelon Infrastructure Limited (“Exelon”), a Public Listed Company involved in the development of power and infrastructure projects, was originally incorporated on February 21, 1979, as a Private Limited Company. Exelon became a deemed Public Limited Company on July 18, 1989 and thereafter, was converted into a Public Limited Company on December 5, 1992. The shares of Exelon are listed on the Bombay Stock Exchange (“BSE”).

1.2 An investigation in the scrip of Exelon was conducted by the Securities and Exchange Board of India (“SEBI”), for the period from December 8, 2010 to January 20, 2012 (“Investigation Period”), for ascertaining any possible violations inter alia of – a. The SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 (“PFUTP Regulations, 2003”); b. The SEBI (Prohibition of Insider Trading) Regulations, 1992 (“PIT Regulations, 1992”) read with the SEBI (Prohibition of Insider Trading) Regulations, 2015 (“PIT Regulations, 2015”); c. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 1997 (“Takeover Regulations, 1997”), and d. The Listing Agreement.

Observations contained in the Investigation Report and findings recorded in the SEBI Ex–Parte Ad–Interim Impounding Order dated June 7, 2016 –

1.3 During the Investigation Period, the shareholding pattern in Exelon for the quarters ending September 2010; December 2010; March 2011; June 2011; September 2011; December 2011 and March 2012 [Source–BSE website], were as follows –

SEPTEMBER 2010 DECEMBER 2010 MARCH 2011 NO. OF NO. OF % NO. OF NO. OF % NO. OF NO. OF % SHAREHOLDERS SHARES SHAREHOLDERS SHARES SHAREHOLDERS SHARES PROMOTER 5 1335900 20.03 5 1193900 17.90 5 1875800 14.06 NON– 1823 5332900 79.97 1786 5474900 82.10 1574 11461800 85.94 PROMOTER TOTAL 1828 6668800 100 1792 6668800 100 1580 13337600 100

JUNE 2011 SEPTEMBER 2011 DECEMBER 2011 NO. OF NO. OF % NO. OF NO. OF % NO. OF NO. OF % SHAREHOLDERS SHARES SHAREHOLDERS SHARES SHAREHOLDERS SHARES PROMOTER 5 1734800 13.01 1 1728048 12.96 1 1651430 12.38 NON– 1620 11602800 86.99 1981 11609552 87.04 2080 11686170 87.62 PROMOTER TOTAL 1626 13337600 100 1983 13337600 100 2082 13337600 100

MARCH 2012 NO. OF NO. OF % SHAREHOLDERS SHARES PROMOTER 1 1467422 11.01 NON– 2147 11870178 88.99 PROMOTER TOTAL 2149 13337600 100

1.4 The shareholding details of the Promoters of Exelon for the quarters ending September 2010; December 2010; March 2011; June 2011; September 2011; December 2011 and March 2012 [Source–BSE website], are provided below –

SEP-10 SEP-10 DEC-10 DEC-10 MAR-11 MAR-11 JUN-11 JUN-11 SR. NO. PROMOTER SHAREHOLDING QUANTITY % QUANTITY % QUANTITY % QUANTITY % 1. S HRADHA PARESHKUMAR MANIK 5000 0.07 5000 0.07 10000 0.07 10000 0.07 2. J AYANTILAL DAYABHAI MANIK 500 0.01 500 0.01 1000 0.01 1000 0.01 3. P ARESH KUMAR D MANIK 200 0 200 0 400 0 400 0 4. S IDDHARTH S MANIK 200 0 200 0 400 0 400 0 5. C EMENTEX INDIA PVT LTD 1330000 19.94 1188000 17.81 1864000 13.98 1723000 12.92 TOTAL 1335900 20.02 1193900 17.89 1875800 14.06 1734800 13

SEP-11 SEP-11 DEC-11 DEC-11 MAR-12 MAR-12 SR. NO. PROMOTER SHAREHOLDING QUANTITY % QUANTITY % QUANTITY % 1. SHRADHA PARESHKUMAR MANIK 2. JAYANTILAL DAYABHAI MANIK 3. PARESH KUMAR D MANIK 4. SIDDHARTH S MANIK 5. CEMENTEX INDIA PVT LTD 1728048 12.96 1651430 12.39 1467422 11.01 TOTAL 1728048 12.96 1651430 12.39 1467422 11.01

1.5 The details of Directors in Exelon during the Investigation Period [Source–BSE website] are provided below –

DATE OF SR. NO. NAME DESIGNATION DATE OF APPOINTMENT CESSATION 1. Srinivasa Rao Marupudi Director, CEO & Compliance Officer 03.09.2007 - 2. Gadde Butchi Tirupati Rao Director 25.10.2006 27.10.2011 3. Ravi Chakravarti Director 03.09.2007 27.10.2011 4. M. Vishnuvardhana Rao Director 03.09.2007 27.10.2011 5. P. R. K. Venkatamurthi Director 03.09.2007 27.10.2011 6. Srinivas Yadav Sher Director 01.09.2010 - 7. Ravindra Deshpande Additional Director 20.07.2011 07.02.2012 8. Shaik Ameer Basha Managing Director 21.10.2011 17.09.2014 9. Miyati Gousal Adam Director 21.10.2011 21.04.2014 10. Rahul Koluguri Director 24.11.2011 09.08.2014 11. Nagendra Komera Director 24.11.2011 20.08.2014 12. Gandodi Shaikh Jilan Additional Director 10.01.2012 30.12.2012

1.6 The relevant Major Corporate Announcements made by Exelon during the Investigation Period, are detailed below –

SR. DATE AND TIME DETAILS OF ANNOUNCEMENT AT BSE STATUS OF NO. OF IMPLEMENTATION ANNOUNCEMENT 1. February 10, 2011 i. To issue upto 10 Crores equity shares of ₹10 i. No information on (7:14 pm) each to the Promoters and others by way of implementation follow on public issue, rights issue, preferential provided by Exelon. allotment, etc.

ii. To issue GDR and/or ADR convertible into ii. No information on equity shares, FCCBs, warrants, convertible implementation into depository receipts on preferential basis provided by Exelon. upto ₹100 Crores.

iii. To issue shares on Qualified Institutional iii. No information on implementation Placement (QIP) basis. provided by Exelon. 2. February 23, 2011 i. Proposal for setting up Coal based Thermal i. No information on (3:01 pm) Power Plant. implementation provided by Exelon. 3. March 07, 2011 i. To sub-divide the equity shares from 1 equity i. Implemented by (1:56 pm) share of ₹10 each into 2 (two) equity shares of Exelon as per ₹5 each. disclosure available on BSE website.

ii. To issue upto 20 Crores equity shares for the ii. No information on purpose of preferential allotment, public issue, implementation rights issue, etc. provided by Exelon.

iii. To issue GDR and/or ADR convertible into iii. No information on equity shares, QIBs, FCCBs, warrants implementation convertible into depository receipts on provided by Exelon. preferential basis upto ₹200 Crores.

1.7 During the period of the abovementioned Corporate Announcements, the Directors of Exelon were as follows –

SR. NO. NAME 1. Srinivasa Rao Marupudi 2. Gadde Butchi Tirupati Rao 3. Ravi Chakravarti 4. M. Vishnuvardhana Rao 5. P. R. K. Venkatamurthi 6. Srinivas Yadav Sher

1.8 A perusal of the share capital of Exelon, reveals that only the Corporate Announcement pertaining to the sub-division of share capital [Refer to point 3(i) of Table at paragraph 1.6] was implemented by Exelon.

1.9 During the Investigation Period, the total income of Exelon increased from ₹76.49 Million (Quarter ended December 2010) to ₹141.04 Million (Quarter ended March 2012). Similarly, the Net Profit increased from ₹3.23 Million (Quarter ended December 2010) to ₹10.78 Million (Quarter ended March 2012). The Profit & Loss Account reported by Exelon [Source–BSE website] is provided below –

QUARTER ENDED YEAR ENDED DESCRIPTION SEP.10 DEC 10 MAR 11 JUN 11 SEP 11 DEC 11 MAR 12 MAR 10 MAR 11 MAR 12 TOTAL INCOME 118.95 76.49 143.29 153.01 113.00 118.65 141.04 297.86 382.95 525.70 TOTAL EXPENDITURE 113.55 72.25 139.37 148.42 107.97 113.39 128.60 286.54 362.89 498.38 NET PROFIT/LOSS 4.05 3.23 3.42 4.09 4.53 4.76 10.78 11.18 17.52 24.16

1.10.1 The Price Volume Analysis in the scrip of Exelon prior to, during and after the Investigation Period is provided below –

TOTAL OPENING CLOSING LOWEST HIGHEST VOLUME PRICE PRICE PRICE PRICE NO. OF (AVG. NO. OF PRICE & (VOLUME) ON (VOLUME) ON (VOLUME) (VOLUME) PERIOD TRADING SHARES VOLUME FIRST DAY OF LAST DAY OF DURING THE DURING THE DAYS TRADED THE PERIOD THE PERIOD PERIOD PERIOD DAILY DURING (₹) (₹) (₹) (₹) THE PERIOD) PRE 31.7 20.5 19.05 32 PRICE INVESTIGATION 01.10.10 07.12.10 07.12.10 15.09.10 2622498 01.10.10 47 19868 45124 2830 170037 (55798) TO VOLUME 01.10.10 07.12.10 29.11.10 22.10.10 07.12.10 INVESTIGATION 19.50 11.01 10.50 112.85 PRICE 08.12.10 08.12.10 20.01.12 20.01.12 18.03.11 37844655 280 TO 32694 30909 117 1189306 (135156) VOLUME 20.01.12 08.12.10 20.01.12 04.10.10 14.09.11 POST 10.80 8.74 7.67 12.49 PRICE INVESTIGATION 23.01.12 30.03.12 07.03.12 03.02.12 2524578 23.01.12 54 20486 26783 4852 182255 (52595) TO VOLUME 23.01.12 30.03.12 15.03.12 28.03.12 30.03.12

1.10.2 The stock split of Exelon (in the ratio of 1:2) as mentioned at paragraph 1.8, occurred on March 23, 2011. Considering the aforesaid, the Price Volume Analysis in the scrip of Exelon was made in 2 patches –

OPENING CLOSING LOWEST HIGHEST TOTAL VOLUME PRICE PRICE PRICE PRICE NO. OF (AVG. NO. OF PRICE & (VOLUME) ON (VOLUME) ON (VOLUME) (VOLUME) PERIOD TRADING SHARES TRADED VOLUME FIRST DAY OF LAST DAY OF DURING THE DURING THE DAYS DAILY DURING THE THE PERIOD THE PERIOD PERIOD PERIOD PERIOD) (₹) (₹) (₹) (₹) PATCH 1: PRE 73 PRICE 19.50 103.60 18.75 112.85 77,01,534 SPLIT PATCH (08/12/10) (23/03/11) (09/12/10) (18/03/11) (1,05,501) 08.12.10 VOLUME 32,694 1,80,401 7,923 4,31,913 TO (08/12/10) (23/03/11) (22/12/10) (02/02/11) 23.03.11 PATCH 2: POST 55 PRICE 49.25 83.80 46.40 87.50 57,09,027 SPLIT PATCH (24/03/11) (13/06/11) (30/03/11) (13/06/11) (1,03,982) 24.03.11 VOLUME 33,944 67,669 15,360 3,21,290 TO (24/03/11) (13/06/11) (27/05/11) (19/04/11) 13.06.11

1.10.3 During the period December 8, 2010 to June 13, 2011, – a. The scrip of Exelon opened at ₹19.50 as on December 8, 2010 and reached a high of ₹112.85 as on March 18, 2011; b. On March 23, 2011, the scrip of Exelon closed at ₹103.60; c. On March 24, 2011 (i.e. after stock split), the scrip of Exelon opened at ₹49.25 and closed at ₹83.80 on June 13, 2011.

1.10.4 As per the Investigation Report, certain entities who were alleged to be connected to Exelon, its Promoters and Directors or were Group Entities of that company, were found to have traded during the period between December 8, 2010–March 23, 2011 [Patch I: Pre–stock split] and the period between March 24, 2011–June 13, 2011 [Patch II: Post–stock split].

1.10.5 The details of the aforementioned entities and the basis for their connection are provided as under – TABLE I SR. NO. NAME CONNECTION WITH EXELON / OTHER ENTITIES OF GROUP 1. Exelon - Company 2. Cementex (India) Pvt. Ltd. - Cementex is promoter entity of Exelon, (Cementex) - Cementex and Exelon have common directors (i.e. persons at Sr. no. 4, 5 and 8 in the table), - Cementex and Dhana Energy Pvt. Ltd. (entity at Sr. no. 10) have a common director namely Srikrishna Vadlamudi (person at Sr. no. 9), - The Company had off market transfers with persons at Sr. no. 8 and 31, - Director of Cementex, Hiten P. Shah (person at Sr. no. 32) is the introducer to the persons at Sr. no. 3, 8, 28, 30 and 31 (in the table) with Networth Stock Broking Limited. - Common e-mail ID with persons at Sr. no. 9, 13 and 19. 3. Srinivasa Rao Marupudi - Director and CEO of Exelon. - He had off market transfers with persons at Sr. no. 11, 13, 27 and 30. - He has common address and mobile no. with entity at Sr. no. 11. - He also has common address, mobile no. and bank a/c no. with entity at Sr. no. 9. - Entity at Sr. No. 32 appeared as a witness in the KYC submitted by Networth Stock Broking Limited. 4. Gadde Butchi Tirupati Rao - Director in Exelon 5. Ravi Chakravati - Director in Exelon 6. M. Vishnuvardhan Rao - Director in Exelon 7. P. R. K. Venkatamurthi - Director in Exelon

8. Srinivas Yadav Sher - Director in Exelon and Cementex (entity at Sr. no. 2), - He had off market transfers with entities at Sr. no. 2, 16, 17, 30, 31. - He has been mentioned as reference in the KYC for entity at Sr. no. 30 at Networth Stock Broking Limited. - Entity at Sr. No. 32 appeared as a witness in the KYC submitted by Networth Stock Broking Limited. - He had off-market connections with entity at Sr. no. 22 and 23 prior to the investigation period - He had off-market connections with entity at Sr. no. 22, 23, 24 and 26 through I. K. Projects Limited, in which he was a Director. - He had off-market connections with entity at Sr. no. 52. 9. Srikrishna Vadlamudi - Director of Cementex (Sr. no. 2) and Dhana (Sr. no. 10), - He had off-market transactions with entity at Sr. no. 14, - He has common e-mail ID i.e. vsrik2000@yahoo.com with entities at Sr. no. 2, 13 and 19, - He had banking transactions with entities at Sr. no. 19. 10. Dhana Energy Pvt. Ltd. (Dhana) - Entities at Sr. no. 9 and 11 are the directors of Dhana, - It had off market transfers with entity at Sr. no. 15 and 27. 11. Marupudi Sree Lakshmi - Director of Dhana (entity at Sr. no. 10), - He has common address and mobile no. with entity at Sr. no. 3, - He had off market transfers with entities at Sr. no. 3 and 19. - He had off-market connections with entity at Sr. no. 22, 23, 24 and 26 through I. K. Projects Limited, in which he was a Director.

12. Rama Krishna Makkena - He had off-market transfers with entities at Sr. no. 27 and 32. - He had off-market connections with entity at Sr. no. 22, 23, 24 and 26 through I. K. Projects Limited, in which he was a Director. 13. Anitha Yarlagadda - She had off market transfers with entity at Sr. no. 3. - She shares the e-mail ID i.e. vsrik2000@yahoo.com with entities at Sr. no. 2, 9 and 19. 14. Satya Surya Narayana - He had off-market transfers with entity at Sr. no. 9. Jonnavittula 15. Swapna Sri Tummala - She had off-market transfers with entity at Sr. no. 10. 16. Mahendra Bhikaji Chile - He had off-market transfers with entity at Sr. no. 8. 17. Gangadhara Rao Ilaparti - He had off-market transfers with entities at Sr. no. 8, 18, 20 and 21. 18. PVS Gangadhara Rao - He had off-market transfers with entities at Sr. no. 17, 19 and 49. 19. Veerabhadra Rao D. - He had off-market transfers with entities at Sr. no. 11 and 18. - He shares same e-mail ID i.e. vsrik2000@yahoo.com with entities at Sr. no. 2, 9 and 13. - He had banking transactions with entity at Sr. no. 9. 20. Elubandi Satyanarayana - He had off-market connections with entity at Sr. no. 17. 21. Yentrapati Ravi - He had off-market connections with entity at Sr. no. 17. 22. Dimple Pankaj Desai - She had off-market connections with entity at Sr. no. 8 prior to the investigation period. - She had off-market connections with one I.K.

Projects Pvt. Ltd. in which the entities at Sr. no. 8, 11 and 12 were the directors.

23. Kanta Anantrai Desai - She had off-market connections with entity at Sr. no. 8 prior to the investigation period. - She had off-market connections with one I.K. Projects Pvt. Ltd. in which entities at Sr. no. 8, 11 and 12 were the directors. 24. Sneha Pankaj Desai - She had off-market connections with entity at Sr. no. 25. - She had off-market connections with one I.K. Projects Pvt. Ltd. in which entities at Sr. no. 8, 11 and 12 were the directors. 25. Anjali Tukaram Sogam She had off-market connections with entity at Sr. no. 24. 26. Gudimetla H. Sunder - He had off-market connections with one I.K. Projects Pvt. Ltd. in which entities at Sr. no. 8, 11 and 12 were the directors. - He had off-market transfers with entity at Sr. no. 51. 27. Shivcharan Shreedhar Kashyap - He had off-market transfers with entities at Sr. no. 3, 10, 12 and 32. - In KYC documents submitted at TM Sanghavi, his introducer is Kamlesh Maisheri, a Director of A.K. Investments (Sr. no. 35). 28. Jayesh Himatlal Mehta - He has common address with entity at Sr. no. 29. - As per KYC, Ronak Choksi (Sr. no. 30) is his reference. - Entity at Sr.

No. 32 appeared as witness to him in the KYC submitted by Networth Stock Broking Limited. 29. Nrupini Jayesh Mehta - Wife of entity at Sr. no. 28 and share common address with him. - As per KYC, Ronak Choksi (Sr. no. 30) is her reference. 30. Ronak Ashwin Choksi - He had off-market transfers with entities at Sr. no. 3, 8, 31 and 32. - He has been mentioned as reference in the KYC while opening accounts of entities at Sr. no. 3, 28, 29, 31 and 33. - Entity at Sr. No. 32 appeared as witness to him in the KYC submitted by Networth Stock Broking Limited. 31. Salma Sharafat Khan - She had off-market transfers with entities at Sr. no. 2, 8 and 30. - As per KYC, Ronak Choksi (Sr. no. 30) is her reference. - Entity at Sr. No. 32 appeared as witness to him in the KYC submitted by Networth Stock Broking Limited. 32. Hiten P. Shah - Director of Cementex (Sr. no. 2) (appointment on July 18, 2012) - He had off-market transfers with entities at Sr. no. 12, 27 and 30. - He has appeared as witness to entities at Sr. no. 3, 8, 28, 30, 31 in the KYC submitted by Networth Stock Broking Limited. - He has been mentioned as reference in the KYC while opening accounts of entity at Sr. no. 34. 33. Sunil Kumar H. Pal - As per KYC, Ronak Choksi (Sr. no. 30) is his reference.

34. Hiten Vallabhji Haria - As per KYC submitted by Networth Broking Limited, Hiten Shah (Sr. no. 32) is his reference. 35. A. K. Investments - As per KYC submitted by TM Sanghavi Brothers Brokerage Limited, entities at Sr. no. 35, 36, 37 and 38 have common address B-35, Mahavir Apt., Ratan Nagar, Borivali (E), Mumbai. - In KYC documents submitted at TM Sanghavi, was introducer for entity at Sr. no. 27.

36. Amrit L. Gandhi (HUF) - As per KYC submitted by TM Sanghavi Brothers Brokerage Limited, entities at Sr. no. 35, 36, 37 and 38 have common address B-35, Mahavir Apt., Ratan Nagar, Borivali (E), Mumbai. - Introduced by Kamlesh Maisheri, director of A.K. Investments (Sr. no. 35) 37. Amrit L. Gandhi - As per KYC submitted by TM Sanghavi Brothers Brokerage Limited, entities at Sr. no. 35, 36, 37 and 38 have common address B-35, Mahavir Apt., Ratan Nagar, Borivali (E), Mumbai. - Spouse of Sr. no. 38 as per ration card copy - He shares common phone no. 9892526271 with entities at Sr. no. 38, 42 and 47. 38. Seema Gandhi - As per KYC submitted by TM Sanghavi Brothers Brokerage Limited, entities at Sr. no. 35, 36, 37 and 38 have common address B-35, Mahavir Apt., Ratan Nagar, Borivali (E), Mumbai. - Spouse of Sr. no. 37 as per ration card copy. - She shares common phone no. 9892526271 with entities at Sr. no. 37, 42 and 47. - He had off-market transfers with entities at Sr. no. 27 and 43. 39. Narendra Omprakash Dogra - In KYC documents submitted at TM Sanghavi, his introducer is Kamlesh Maisheri, - He is the director of A.K.

Investments (Sr. no. 35). 40. Jitendra L. Gandhi - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri, - He is the director of A.K. Investments (Sr. no. 35). 41. Kantilal Lakshmichand - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri. - He is the director of A.K. Investments (Sr. no. 35). 42. Shivangi Jagmohan Singh - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri, - He is the director of A.K. Investments (Sr. no. 35), - He shares common phone no. 9892526271 with entities at Sr. no. 37, 38 and 47. 43. Divyesh Harish Surana - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri, - He is the director of A.K. Investments (Sr. no. 35), - He had off-market transfers with entity at Sr. no. 38. 44. Hussain Mohammed Shaikh - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri, director of A.K. Investments (Sr. no. 35). 45. Parul Anupam Khanna - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri, director of A.K. Investments (Sr. no. 35). 46. Jigna Manish Shah - In KYC documents submitted at TM Sanghavi, introducer is Kamlesh Maisheri, director of A.K.

Investments (Sr. no. 35). - He shares common address with entity at Sr. no. 47. 47. Bhavnaben Nimeshbhai Mistry - As per UCC details uploaded at BSE by TM Sanghavi, Bhavnaben shares common contact no. 9892526271 with entities at Sr. no. 37, 38 and 42. 48. Nishita Danish Merchant - As per UCC details uploaded at BSE by TM Sanghavi, Nishita shares common contact no. 9619191999 with entities at Sr. no. 37 and 41. 49. Venkata Subbarao Yarra - He had off market transfers with entity at Sr. no. 18. 50. Shaik Ameer Basha - He is director in Exelon appointed on October 21, 2011. 51. Parvathaneni Mounisha - He had off-market transfers with entity at Sr. no. 26. 52. Piyush Naresh Kothari - He had off-market connections with entity at Sr. no. 8.

2.1.1 The Promoters/Directors of Exelon alongwith the group entities were prima facie found to have devised a manipulative scheme, by using a two pronged approach, i.e. – a. The Corporate Announcements made by Exelon during the period from February 10, 2011 to March 7, 2011 (mentioned at paragraph 1.6 of page 4), were in the nature of issue of fresh securities (except for the announcement of stock split). However, from the Balance Sheet alongwith shareholding pattern of Exelon for the Financial Years 2010–11 and 2011–12, it was observed that the shareholding of the Company had not changed during the Investigation Period, except for the change after the stock split effected on March 24, 2011. Further, it is observed that Exelon and its Directors did not inform BSE about non– implementation of decisions taken in the aforesaid two meetings (held on February 10, 2011 and on March 7, 2011). These facts suggests that Exelon did not implement any of the Corporate Announcements other than the announcement pertaining to the splitting of shares. Exelon and its 6 Directors [Refer to Table at paragraph 1.7], therefore, made separate Corporate Announcements of a positive nature to BSE, which led to an increase in the price of the scrip of that company; however, without any intention of implementing them. b. The Group Entities connected to the Promoters/Directors of Exelon helped increase the price of the scrip by establishing New High Price (“NHP”) mainly through repeated first trades during the period from December 8, 2010–March 23, 2011 [Patch I: Pre–stock split] and the period from March 24, 2011–June 13, 2011 [Patch II: Post–stock split].

During the period from February 10, 2011 to March 7, 2011 i.e. when false and misleading Corporate Announcements were made by Exelon and its 6 Directors, the Group/Connected Entities [Refer to Table at paragraph 1.10.5] had traded in the scrip of that company. The Group Entities connected to the Promoters/Directors of Exelon manipulated the price of the scrip by contributing ₹71.05 to the NHP out of the total market NHP of ₹93.35 (i.e. 76.11% of market NHP) during the period of December 8, 2010 to March 23, 2011 (i.e. the period of price rise before the stock split) by trading in 67,454 shares (i.e. 0.87% of market volume during that period). Further, these entities continued to manipulate the price of the scrip even after the stock split and contributed ₹17.40 to NHP out of the total market NHP of ₹38.25 (i.e. 45.49% of market NHP), during the period from March 24, 2011 to June 13, 2011 (the period of price rise after stock split) by trading in 918 shares (0.02% of market volume during that period).

2.2 Upon a consideration of the Investigation Report, SEBI issued the following directions vide an Ex–Parte Ad–Interim Order dated June 7, 2016 (“Impounding Order”), –

10. “As the alleged gains were made during December 2010 to June 2011, it becomes reasonable and necessary to levy an interest at the rate of 12% simple interest per annum. The gains along with the interest are calculated as follows: TABLE – Q SR. NO. NAME OF ENTITY PROFIT INTEREST @12%P.A.* TOTAL (₹) (₹) 1. HITEN VALLABHJI HARIA 10,168,233 6,060,824 16,229,057 2. CEMENTEX (INDIA) P. LTD. 7,792,585 4,644,808 12,437,393 3. RONAK ASHWIN CHOKSI 9,186,988 5,475,948 14,662,936 4. A.K. INVESTMENTS 5,050,849 3,010,583 8,061,432 5. DIVYESH HARISH SURANA 5,681,121 3,386,259 9,067,380 6. SALMA SHARAFAT KHAN 3,904,108 2,327,062 6,231,170 7. JAYESH HIMATLAL MEHTA 2,855,426 1,701,990 4,557,416 8. NARENDRA OMPRAKASH DOGRA 1,999,847 1,192,018 3,191,865 9. KANTA ANANTRAI DESAI 1,799,766 1,072,759 2,872,525 10. ANJALI TUKARAM SOGAM 1,458,049 869,077 2,327,126 11. JITENDRA L. GANDHI 2,780,463 1,657,308 4,437,771 12. AMRIT L. GANDHI(HUF) 3,549,639 2,115,779 5,665,418 13. SEEMA GANDHI 1,777,251 1,059,339 2,836,590 14. ANITHA YARLAGADDA 1,322,130 788,062 2,110,192 15. GANGADHARA RAO ILAPARTI 1,178,231 702,290 1,880,521 16. HUSSAIN MOHAMMED SHAIKH 1,167,976 696,178 1,864,154 17. VEERABHADRA RAO DANDAMUDI 1,098,324 654,661 1,752,985 18. SHIVCHARAN SHREEDHAR KASHYAP 1,928,749 1,149,640 3,078,389 19. JIGNA MANISH SHAH 1,485,051 885,172 2,370,223 20. SNEHA PANKAJ DESAI 748,364 446,066 1,194,430 21. NISHITA DANISH MERCHANT 716,842 427,277 1,144,119 22. DHANA ENERGY P. LTD. 1,871,650 1,115,606 2,987,256 23. SRIKRISHNA VADLAMUDI 711,248 423,943 1,135,191 24. KANTILAL LAKSHMICHAND 687,900 410,026 1,097,926 25. GUDIMETLA H SUNDER 1,014,946 604,963 1,619,909 26. SHIVANGI JAGMOHAN SINGH 382,725 228,125 610,850 27. DIMPLE PANKAJ DESAI 380,557 226,833 607,390 28. PVS GANGADHARA RAO 375,729 223,955 599,684 29. SUNIL KUMAR H. PAL 543,271 323,819 867,090 30. VENKATA SUBBARAO YARRA 161,573 96,306 257,879 31. AMRIT L. GANDHI 141,936 84,602 226,538 32. BHAVNABEN NIMESHBHAI MISTRY 155,896 92,923 248,819 33. YENTRAPATI RAVI 124,305 74,093 198,398 34. PARUL ANUPAM KHANNA 101,561 60,536 162,097 35. HITEN P. SHAH 1,529,100 911,427 2,440,527 36. PARVATHANENI MOUNISHA 65,176 38,848 104,024 37. MARUPUDI SREE LAKSHMI 54,045 32,214 86,259 38. SWAPNA SRI TUMMALA 45,491 27,115 72,606 39. SATYA SURYA NARAYANA JONNAVITTULA 9,686 5,773 15,459 40. PIYUSH NARESH KOTHARI 4,614 2,750 7,364

41. SHAIK AMEER BASHA 1,002 597 1,599 42. SRINIVAS YADAV SHER 577,834 344,421 922,255 43. RAMA KRISHNA MAKKENA 537,272 320,244 857,516 44. NRUPINI JAYESH MEHTA 524,191 312,447 836,638 45. SRINIVASA RAO MARUPUDI 463,517 276,282 739,799 46. MAHENDRA BHIKAJI CHILE 351,750 209,662 561,412 47. ELUBANDI SATYANARAYANA 154,469 92,072 246,541 TOTAL 78,621,436 46,862,682 12,54,84,118

From the above table, it can be observed that the above persons/ entities had made alleged illegal profits to the tune of ₹12.54 Crores in aggregate including interest through trading in the scrip of Exelon. … 12. Accordingly, as an interim measure, an ad-interim ex-parte Order for impounding such alleged profits under Section 11(4)(d) of the Securities and Exchange Board of India Act, 1992 needs to be issued against– TABLE – R SR. NO. NAME PERMANENT ACCOUNT NUMBER 1. EXELON INFRASTRUCTURE LIMITED AAACM2862M 2. CEMENTEX (INDIA) PVT. LIMITED AAACC9265A 3. SRINIVASA RAO MARUPUDI ACQPM0876L, BCDPM3124P 4. GADDE BUTCHI TIRUPATI RAO AHUPG9920A 5. RAVI CHAKRAVATI AJXPR4789F 6. M. VISHNUVARDHAN RAO ABYPM0993M 7. P R K VENKATAMURTHI AFQPP6066G 8. SRINIVAS YADAV SHER AUAPS8547G 9. SHAIK AMEER BASHA AEZPB3408A 10. SREE LAKSHMI MARUPUDI ALYPM2964Q 11. HITEN VALLABHJI HARIA AAAPH6890H 12. A.K. INVESTMENTS AANFA6009Q 13. NARENDRA OMPRAKASH DOGRA AJMPD8729N 14. KANTA ANANTRAI DESAI AAEPD6006F 15. ANJALI TUKARAM SOGAM CGNPS1443N 16. JITENDRA L. GANDHI AACPG6473H 17. AMRIT L. GANDHI(HUF) AAJHA4701R 18. GANGADHARA RAO ILAPARTI AANPI9650F 19. HUSSAIN MOHAMMED SHAIKH BSSPS2832P 20. JIGNA MANISH SHAH ANQPS6789P 21. SNEHA PANKAJ DESAI AIBPD1454A 22. NISHITA DANISH MERCHANT AMHPM8133B 23. DHANA ENERGY P. LTD. AACCV7693M 24. SRIKRISHNA VADLAMUDI ADNPV5504C 25. KANTILAL LAKSHMICHAND ADSPK7577K 26. GUDIMETLA H SUNDER BMLPS9664N 27. SHIVANGI J. SINGH AOSPS5911E 28. DIMPLE PANKAJ DESAI AUQPD3909F 29. PVS GANGADHARA RAO AKYPP5600M 30. SUNIL KUMAR H. PAL BKSPP6938B 31. VENKATA SUBBARAO YARRA AAPPY4270P 32. AMRIT L. GANDHI AACPG5265H 33. BHAVNABEN NIMESHBHAI MISTRY ALIPM5347B 34. YENTRAPATI RAVI ABWPY6767F 35. PARUL ANUPAM KHANNA BCUPK8420R 36. HITEN P. SHAH AHAPS0889A 37. PARVATHANENI MOUNISHA BAOPP1399G 38. SWAPNA SRI TUMMALA ALDPT7720Q

39. SATYA SURYA NARAYANA JONNAVITTULA ACRPJ9665R 40. PIYUSH NARESH KOTHARI AEOPK1882L 41. NRUPINI JAYESH MEHTA BDTPM2261E 42. MAHENDRA BHIKAJI CHILE AHNPC8127G 43. ELUBANDI SATYANARAYANA DGCPS7022F 44. RAMA KRISHNA MAKKENA BCKPK1101P 45. ANITHA YARLAGADDA ACAPY5774B 46. SALMA SHARAFAT KHAN BVSPK9348F 47. SEEMA GANDHI AAEPG0960B 48. RONAK ASHWIN CHOKSI ADDPC2938D 49. VEERABHADRA DANDAMUDI ABVPD6656R 50. DIVYESH HARISH SURANA DALPS0578H 51. JAYESH HIMATLAL MEHTA AIFPM2216D 52. SHIVCHARAN SHREEDHAR KASHYAP ATOPK6636K

13. In view of the foregoing, in order to protect the interest of the investors and the integrity of the securities market, I, in exercise of the powers conferred upon me by virtue of section 19 read with sections 11(1), 11(4)(d) and 11B of the SEBI Act, 1992 (“SEBI Act”), hereby impound the alleged unlawful gains of a sum of ₹12,54,84,118 (alleged gain of ₹7,86,21,436 + interest of ₹4,68,62,682 (from 14/06/2011 to 01/06/2016), jointly and severally from persons/entities tabulated in the paragraph 12 above. 14. The Banks are directed that no debits shall be made, without permission of SEBI, in respect of the bank accounts held by all the persons/entities tabulated in paragraph 12 above, except for the purposes of transfer of funds to the escrow account as directed in paragraph 13 above. Further, the Depositories are also directed that no debit shall be made, without permission of SEBI, in respect of the demat accounts held by the above said persons. However, credits, if any, into the accounts maybe allowed. The Banks and the Depositories are directed to ensure that all the above directions are strictly enforced.

Further, debits may also be allowed for amounts available in the account in excess of the amount to be impounded. Banks are allowed to debit the accounts for the purpose of complying with this Order. 15. The persons/ entities tabulated in paragraph 12 above are also directed not to dispose of or alienate any of their assets/properties/securities, till such time the amounts mentioned in paragraph 13 are credited to an escrow account [“Escrow Account in Compliance with SEBI Order dated June 07, 2016 – A/c (in the name of the respective persons/entities)”] created specifically for the purpose in a Nationalized Bank. The escrow account/s shall create a lien in favour of SEBI and the monies kept therein shall not be released without permission from SEBI. On production of proof by any of the persons, mentioned in paragraph 14, that the said money is deposited in the escrow account, SEBI shall communicate to the Banks and Depositories to defreeze the accounts. 16. Further, the persons/entities tabulated in paragraph 12 above are directed to provide, within 7 days of this order, a full inventory of all their assets and properties and details of all their bank accounts, demat accounts and holdings of shares/securities, if held in physical form and details of companies in which they hold substantial or controlling interest.

17. The above direction shall come into force with immediate effect.

18. This Order is without prejudice to the right of SEBI to take any other action that may be initiated against the 52 persons/entities covered under this Order, in accordance with law. The persons/ entities against whom this Order has been passed may file their replies to SEBI within 21 days from the date of receipt of this order, if they so desire. They may also indicate in their replies whether they wish to avail an opportunity of personal hearing in the matter.”

2.3 In compliance with paragraph 15 of the Impounding Order dated June 7, 2016, – i. Corporation Bank vide letter dated June 21, 2016, informed SEBI that an amount of approximately ₹2.26 Lakhs was debited from the bank account of Shri Amrit L. Gandhi, which was thereafter kept in a fixed deposit under lien to SEBI. Subsequently, Corporation Bank also defroze all accounts of Shri Amrit L. Gandhi with that Bank ii. Similarly, vide another letter also dated June 21, 2016, Corporation Bank informed SEBI that an amount of approximately ₹1.62 Lakhs was debited from the bank account of Ms. Parul Anupam Khanna, which was thereafter kept in a fixed deposit under lien to SEBI. Subsequently, Corporation Bank also defroze all accounts of Ms. Parul Anupam Khanna with that Bank.

Securities Appellate Tribunal Order dated July 15, 2016 –

3.1 Shri Amrit L. Gandhi [HUF]; Shri Amrit L. Gandhi; Ms. Shivangi J. Singh; Smt Bhavnaben Nimeshbhai Mistry; Ms. Parul Anupam Khanna and Ms. Seema Gandhi challenged the Impounding Order dated June 7, 2016, before the Hon’ble Securities Appellate Tribunal (“SAT”) in Appeal no. 207 of 2016. The Hon’ble SAT disposed of the aforesaid Appeal vide an Order dated July 15, 2016, with the following directions –

1. “Appellants are aggrieved by the ex-parte ad-interim order passed by the Whole Time Member (‘WTM’ for short) of Securities and Exchange Board of India (‘SEBI’ for short) on June 7, 2016. By the said Order, several entities including the appellants herein have been directed to deposit an amount specified against their names as set out in the impugned Order. The said Order directs the parties set out therein to file their replies within 21 days from the date of the receipt of the said letter. It is the case of the appellants that by their letter dated June 20, 2016 they had sought inspection of the documents; however, inspection is not yet given by SEBI. 2. Counsel for SEBI states that within one week from today requisite copies of the documents sought by the appellants would be furnished to the appellants. Appellants would then be entitled to file their reply within one week thereafter. 3. Within four weeks from the date of receiving reply from the appellants, SEBI is directed to pass an order after giving an opportunity of hearing to the appellants.

4. Appeal is disposed of in the above terms with no order as to costs.”

Proceedings pursuant to the SAT Order dated July 15, 2016 –

4.1 In compliance with paragraph 2 of the abovementioned SAT Order dated July 15, 2016, the following entities vide a common letter dated July 15, 2016, requested for an opportunity to conduct an inspection of documents relied upon in the Impounding Order dated June 7, 2016, –

TABLE II–A SR. NO. NAME OF ENTITY DATE OF RECEIPT AT SEBI INSPECTION GRANTED BY SEBI AND OF REQUEST FOR AVAILED BY THE ENTITIES ON INSPECTION 1. AMRIT L GANDHI 19.07.2016 & 26.07.2016 2. AMRIT L GANDHI (HUF) 19.07.2016 & 26.07.2016 3. PARUL ANUPAM KHANNA 18.07.2016 19.07.2016 & 26.07.2016 4. BHAVNA N MISTRY 19.07.2016 & 26.07.2016 5. SHIVANGI JAGMOHAN SINGH 19.07.2016 & 26.07.2016 6. SEEMA GANDHI 19.07.2016 & 26.07.2016

4.2 Subsequent to inspection of documents relied upon in the Impounding Order dated June 7, 2016, the following entities submitted their replies as under, –

TABLE II–B SR. NO. NAME OF ENTITY DATE OF RECEIPT OF REPLY AT SEBI 1. AMRIT L GANDHI 27.07.2016 2. AMRIT L GANDHI (HUF) 27.07.2016 3. PARUL ANUPAM KHANNA 25.07.2016 4. BHAVNA N MISTRY 25.07.2016 5. SHIVANGI JAGMOHAN SINGH 25.07.2016 6. SEEMA GANDHI 25.07.2016

4.3.1 In compliance with the abovementioned SAT Order dated July 15, 2016, an opportunity of personal hearing was also granted to the entities at paragraph 4.2 as under –

TABLE II–C SR. NO. NAME OF ENTITY DATE OF PERSONAL ATTENDANCE AT PERSONAL HEARING HEARING 1. AMRIT L GANDHI 12.08.2016 2. AMRIT L GANDHI (HUF) 12.08.2016 3. PARUL ANUPAM KHANNA 12.08.2016 ENTITIES ATTENDED HEARING 4. BHAVNA N MISTRY 12.08.2016 5. SHIVANGI JAGMOHAN SINGH 12.08.2016 6. SEEMA GANDHI 12.08.2016

4.3.2 In addition to the above, the following entities were also granted an opportunity to inspect documents relied upon in the Impounding Order (where such request was made) alongwith an opportunity of hearing as under –

TABLE III SR. NO. NAME OF ENTITY DATE OF PERSONAL STATUS OF REPLY TO IMPOUNDING ORDER HEARING ATTENDANCE AT PERSONAL HEARING 7. EXELON INFRASTRUCTURE LIMITED 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 8. CEMENTEX (INDIA) PRIVATE 14.09.2016 ENTITY DID NOT SUBMIT REPLY LIMITED ENTITY ATTENDED HEARING ON 14/09/2016 9. SRINIVASA RAO MARUPUDI 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 10. GADDE BUTCHI TIRUPATI RAO 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 11. RAVI CHAKRAVATI 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 12. M. VISHNUVARDHAN RAO 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 13. P. R. K. VENKATAMURTHI 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 14. SRINIVAS YADAV SHER 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 15. SHAIK AMEER BASHA 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 16. SREE LAKSHMI MARUPUDI 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 17. HITEN VALLABHJI HARIA 12.08.2016 ENTITY SUBMITTED REPLY ON 22/07/2016 02.09.2016 ENTITY DID NOT ATTEND HEARING 18. A. K. INVESTMENTS 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 16/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 19. NARENDRA OMPRAKASH DOGRA 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 13/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016

20. KANTA ANANTRAI DESAI 12.08.2016 ENTITY GRANTED INSPECTION ON 25/07/2016 02.09.2016 ENTITY SUBMITTED REPLY ON 11/08/2016 ENTITY DID NOT ATTEND HEARING ON 12/08/2016 & 02/09/2016 21. ANJALI TUKARAM SOGAM 12.08.2016 ENTITY GRANTED INSPECTION ON 25/07/2016 02.09.2016 ENTITY SUBMITTED REPLY ON 11/08/2016 ENTITY DID NOT ATTEND HEARING ON 12/08/2016 & 02/09/2016 22. JITENDRA L. GANDHI 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 08/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 23. GANGADHARA RAO ILAPARTI 12.08.2016 ENTITY SUBMITTED REPLY ON 27/06/2016 02.09.2016 ENTITY DID NOT ATTEND HEARING 24. HUSSAIN MOHAMMED SHAIKH 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 13/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 25. JIGNA MANISH SHAH 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 13/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 26. SNEHA PANKAJ DESAI 12.08.2016 ENTITY GRANTED INSPECTION ON 25/07/2016 02.09.2016 ENTITY SUBMITTED REPLY ON 11/08/2016 ENTITY DID NOT ATTEND HEARING ON 12/08/2016 & 02/09/2016 27. NISHITA DANISH MERCHANT 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 05/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 28. DHANA ENERGY P. LIMITED 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 29. SRIKRISHNA VADLAMUDI 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 30. KANTILAL LAKSHMICHAND 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 16/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 31. GUDIMETLA H SUNDER 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 32. DIMPLE PANKAJ DESAI 12.08.2016 ENTITY GRANTED INSPECTION ON 25/07/2016 02.09.2016 ENTITY SUBMITTED REPLY ON 11/08/2016 ENTITY DID NOT ATTEND HEARING ON 12/08/2016 & 02/09/2016 33. P. V. S. GANGADHARA RAO 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 34. SUNIL KUMAR H. PAL 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 35. VENKATA SUBBARAO YARRA 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 36. YENTRAPATI RAVI 14.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 37. HITEN P. SHAH 15.09.2016 ENTITY SUBMITTED REPLY ON 30/08/2016 ENTITY ATTENDED HEARING ON 15/09/2016 38. PARVATHANENI MOUNISHA 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 39. SWAPNA SRI TUMMALA 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 40. SATYA SURYA NARAYANA 12.08.2016 ENTITY SUBMITTED REPLY ON 06/09/2016 JONNAVITTULA 02.09.2016 ENTITY ATTENDED HEARING ON 02/09/2016 41. PIYUSH NARESH KOTHARI 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING

42. NRUPINI JAYESH MEHTA 12.08.2016 ENTITY SUBMITTED REPLY ON 01/09/2016 ENTITY ATTENDED HEARING ON 12/08/2016 43. MAHENDRA BHIKAJI CHILE 15.09.2016 ENTITY SUBMITTED REPLY ON 15/09/2016 ENTITY ATTENDED HEARING ON 15/09/2016 44. ELUBANDI SATYANARAYANA 02.09.2016 ENTITY SUBMITTED REPLY ON 30/06/2016 ENTITY DID NOT ATTEND HEARING 45. RAMA KRISHNA MAKKENA 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 46. ANITHA YARLAGADDA 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 47. SALMA SHARAFAT KHAN 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY DID NOT ATTEND HEARING 48. RONAK ASHWIN CHOKSI 12.08.2016 ENTITY SUBMITTED REPLY ON 25/07/2016 ENTITY ATTENDED HEARING ON 12/08/2016 49. VEERABHADRA DANDAMUDI 15.09.2016 ENTITY DID NOT SUBMIT REPLY ENTITY ATTENDED HEARING ON 14/09/2016 50. DIVYESH HARISH SURANA 14.09.2016 ENTITY GRANTED INSPECTION ON 26/07/2016 ENTITY SUBMITTED REPLY ON 01/08/2016 ENTITY ATTENDED HEARING ON 14/09/2016 51. JAYESH HIMATLAL MEHTA 12.08.2016 ENTITY SUBMITTED REPLY ON 01/09/2016 ENTITY ATTENDED HEARING ON 12/08/2016 52. SHIVCHARAN SHREEDHAR KASHYAP 14.09.2016 ENTITY GRANTED INSPECTION ON 26.07.2016 ENTITY SUBMITTED REPLY ON 22.08.2016 ENTITY ATTENDED HEARING ON 14.09.2016

4.3.3 In respect of the entities at Sr. nos. 20 (Kanta Anantrai Desai), 21 (Anjali Tukaram Sogam), 26 (Sneha Pankaj Desai) & 32 (Dimple Pankaj Desai), as stated above, an opportunity for inspection of documents relied upon in the Impounding Order was granted to them on July 25, 2016. However, vide letters dated August 11, 2016, the aforesaid entities submitted that they were not granted a complete inspection of documents as requested by them. Pursuant to a consideration of the aforesaid correspondences, SEBI vide letter dated September 8, 2016, inter alia informed the said entities that all relevant documents/information related to them was provided during the inspection.

Submissions/Contentions raised by the entities at paragraph 4.2 –

5.1 I have considered the replies to the Impounding Order dated June 7, 2016 alongwith the submissions made by the entities at paragraph 4.2 during the hearing held on August 12, 2016. I have also considered all other relevant material available on record. In the light of the same, I shall now proceed to deal with the matter.

5.2 In their replies and submissions during the hearing held before me, the entities at paragraphs 4.2 inter alia raised the following common contentions – i. “The Investigation Period considered is from 8.12.2010 to 20.01.2012. The (Impounding) Order dated June 7, 2016 was issued after 5 years from the dates of settled trades and obligations … There is therefore, a great delay in passing the (Impounding) Order. ii. (We) deny having violated provisions of Regulation 3(a), (b), (c) & (d), 4(1), 4(2)(a) of PFUTP Regulations, 2003, in the matter of trading in Exelon scrip. iii. BSE’s BOLT trading platform is an online, real time computerized, price and time priority matching trading system for orders keyed in different scrips through a large number of terminals spread throughout the country. The trading module is therefore anonymous and its algorithm not known to anyone. … (Our) orders/trades were separate, independent and stand alone and (we) had no connection with any other investor in the matter of my dealings in the said scrip. In the circumstances, matching of orders was purely system driven, technical, unintentional and of no consequence to (us). iv.

(We) sold shares after first buying them through (our) broker. (We) took delivery of shares and sold and delivered also accordingly. v. The scrip was in ‘T’ group with circuit filters as stated in Investigation Report on its price on a daily basis. vi. There was no creation of any false or misleading appearance of trading as deliveries of shares were taken/given actually. The trading was real, genuine and not fictitious/artificial. (We) were not a benami or impersonator or a dummy person. vii. (We) submit that (our) trades were done in (our) name/code and for which (we) paid from (our) mapped bank account. It appears that the trading in the scrip was in ‘T’ group. (We) remained invested. (Our) profit was thus the outcome of delivery based investment (in Exelon scrip), which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) ‘connection’ is erroneous. None was involved in (our) trading and settlement–pre trade, trade and post–trade and hence, bunching, clubbing, lumping and including (us) in the said group and tying (us) with them in the matter of (our) independent commercial transactions is wrong. viii.

(We) were not part of any scheme to make illegal gains and defraud the genuine investors as alleged/inferred or otherwise. No particulars or details or features of purported scheme and (our) specific role/involvement therein has been stated, leave alone established. No connection of (ours) with the company or its Directors has been stated. (We) emphatically submit that roping (us) in on the basis of family relationship or telephone number in some KYCs is totally wrong. ix. The power to issue directions of impounding under section 11(1), 11(4) and 11B is a drastic power having serious civil consequences and ramifications on the repute and livelihood of those against whom it is directed. The aforesaid power is not available for retrospective application and such impounding results into penal action.

x. The scrip of Exelon is ‘T’ group and it is 100% delivery based volume. The trades were 5% price within circuit and with 100% VAR Margin. xi. SEBI is not entitled to levy and recover interest @ 12% p.a. as claimed or otherwise. xii. WTM, SEBI is not a ‘Court’ under the Interest Act, 1978 and has no power to levy as well as recover and also take coercive steps to enforce his own order of claim of interest. SEBI did not issue any notice in this regard and demanded the alleged profit. Hence for this reason, interest cannot be claimed.”

5.3 In addition to the above, the entities at paragraph 4.2 have also individually raised the following contentions vide their aforementioned replies and submissions during the personal hearing before me, –

5.3.1 Amrit L. Gandhi – i. “My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 168294 – 142843 Patch 2 + 60140 – 111042 ii. I met all my obligations. There remained 98697 shares of Exelon as on 14.6.2012. iii. I am wrongly treated as ‘connected’ with my wife Mrs. Seema Gandhi, Ms. Shivangi J. Singh and Ms. Bhavnaben Nimeshbhai Mistry. My HUF is a separate and distinct entity in the eyes of law. iv. SEBI has not followed regulatory mode, manner and procedure as followed in the case of Sarang Chemicals Ltd. wherein for disgorgement of alleged unlawful gains of ₹1,60,76,904 – 13 parties involved have been issued SCN dated 19.5.2016 and their accounts have not been frozen prior to issue to SCN. The said SCN too is u/s 11B of SEBI Act and for alleged violations of provisions of PFUTP Regulations.”

5.3.2 Amrit L Gandhi (HUF) – i. “My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 39861 – 39861 Patch 2 + 835 – 835 ii. I am a partner of A. K. Investments. The very fact that even among family members, there is separate and distinct trading pattern that shows non–uniform way/feature in the matter of trading, investment and holding. iii. I met all my obligations. There was nil holding of Exelon as on 14.6.2012.

iv. I am wrongly treated as ‘connected’ with my wife Mrs. Seema Gandhi, Ms. Shivangi J. Singh and Ms. Bhavnaben Nimeshbhai Mistry. My HUF is a separate and distinct entity in the eyes of law.”

5.3.3 Parul Anupam Khanna – i. “It appears that Mr. Kamlesh Maisheri introduced me and signed my KYC to the broker Sanghavi Bros. Brokerage Ltd., broker, as introduction is a requirement in KYC. I had no connection or relationship -commercial, family, etc. - with him. I had no off-market … with him. My trades were done in my name / code and for which I paid from my mapped bank account. As I am a small person my volume in Exelon was very small - 20,000 shares bought on 24.12.2010 for Rs. 6,02,022.49 (SEBI considered Rs, 5,99,439/-) and I took deliveries'. (It appears that the trading in the scrip was in T group.) I remained invested. Later on I sold on 5.1.2011- 20,000 shares for Rs. 6,98,036/- and earned a profit of Rs. 96,014/- (SEBI has considered Rs. 1,01,561/-) on my investment My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. Apart from this single and stray buy and sale, no other trade was done in this scrip. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. Mr. Kamlesh Maisheri was not involved in my trading and settlement - pre-trade, trade and post-trade and hence bunching, clubbing, lumping and including me in the said group and tying me with the said Mr. Kamlesh Maisheri in the matter of my commercial transactions is wrong. ii. Trading Details: Date Quantity 24.12.2010 + 20,000 05.01.2011 - 20,000 iii. My trading was on 2 days (one day 24.12.2010 bought and on another day 5.1.2011 sold). iv. No role of mine in the trading of A.K. Investments or their partners has been stated.”

5.3.4 Bhavna Nimeshbhai Mistry – i. “It appears that Mr. Amrit L Gandhi introduced me in my KYC to the broker Sanghavi Bros. Brokerage Ltd., broker, as introduction is a requirement in KYC. I had no connection or relationship -commercial, family, etc. - with him. I had no off-market … with him. My trades were done in my name / code and for which I paid from my mapped bank account. As I am a small person my volume in Exelon was very small - 23,301 shares bought and I took deliveries. (It appears that the trading in the scrip was in T group.) I remained invested. I sold 21,601 shares SEBI has considered Rs. 1,55,896 as profit on my investment. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. Apart from this small buy and sale, no other trade was done in this scrip.

The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. Mr. Amrit L. Gandhi was not involved in my trading and settlement - pre-trade, trade and post-trade and hence bunching, clubbing, lumping and including me in the said group and tying me with the said Mr. Amrit Gandhi in the matter of my independent commercial transactions is wrong. ii. Trading Details: No. of shares No. of shares Patch 1 + 20601 – 20601 Patch 2 + 1000 – 1000 iii. No role of mine in the trading of A.K. Investments or their partners has been stated.”

5.3.5 Shivangi Jagmohan Singh – i. “It appears that Mr. Kamlesh Maisheri introduced me in my KYC to the broker Sanghavi Bros. Brokerage Ltd., broker, as introduction is a requirement in KYC. I had no connection or relationship -commercial, family, etc. - with him. I had no off-market … with him. My trades were done in my name / code and for which I paid from my mapped account. As I am a small person my volume in Exelon was very small – 34,904 shares bought and I took deliveries. (It appears that the trading in the scrip was in ‘T’ group.) I remained invested. I sold 34,304 shares and delivered. SEBI has considered Rs. 3,82,725 as profit on my investment. My profit was thus the outcome of deliveries based investment which is a permissible activity. Apart from this small buy and sale, no other trade was done in this scrip. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) ‘connection’ is erroneous. Mr. Kamlesh Maisheri. Mr. Amrit L Gandhi (partners of A.K. Investments) were not involved in my trading and settlement – pre trade, trade and post – trade and hence, bunching, clubbing, lumping and including me in the said group and tying me with the said Mr. Amrit L Gandhi on the basis of mobile number in my KYC form in the matter of my independent commercial transactions is wrong. ii. My trading volume was very small, on few days and deliveries based. Profit too was small. Date Quantity 24.12.2010 + 14,395 03.01.2011 + 20,000 iii. I sold share after first buying them through my broker. I took deliveries of shares on a 100% basis and sold and delivered also accordingly. Date Quantity 30.12.2010 - 4530 17.01.2011 - 5,900 24.01.2011 - 20,000 28.01.2011 - 3,964 iv. No role of mine in the trading of A.K. Investments or their partners has been stated.”

5.3.6 Seema Gandhi – i. “Mr. Amrit L. Gandhi is my husband and mobile number is his. My off-market transactions have not been considered as objectionable. (Para 9 of Investigation Report) My trades were done in my name / code and for which I paid from my mapped bank account. My volume in Exelon was as under-shown in tables. It appears that the trading in the scrip was in T group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. Mr. Amrit L Gandhi not involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong. ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 181250 170250 Patch 2 + 137962 124765 iii. My trading volume was mostly deliveries based. Profit was not substantial. As I could not sell 1,46,567 shares of Exelon as on 31.3.2012, I suffered losses. iv. I am wrongly treated as "connected" with Mr. Amrit l Gandhi. I am a separate and distinct person in the eyes of law. My trading was carried out in my name/code and I met settlement obligations from my own funds and shares. My husband's mobile number appearing in KYC of some clients of broker has nothing to do with my trading in Exelon scrip.”

Submissions/Contentions raised by some of the entities at paragraph 4.3.2 –

5.4.1 Hussain Mohammed Shaikh – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained Invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity and was genuine. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement-pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong.

ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 50000 -50000 Patch 2 + 6962 -iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip

5.4.2 Jigna Manish Shah – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 22065 -12065 Patch 2 + 15000 -29000 iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip

5.4.3 Jitendra L Gandhi – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 100000 -99990 Patch 2 + 89372 -49392 iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip

5.4.4 Kantilal Lakshmichand – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 38295 -38295 Patch 2 + 13046 -13046 iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip

5.4.5 Narendra Omprakash Dogra – i. I submit that my trades were done in my name / code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 96560 -87117 Patch 2 - -iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip

5.4.6 Nishita Danish Merchant – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 57473 -57473 Patch 2 - -iii. I am wrongly treated as ‘connected’ with Mr. Amrit L. Gandhi, partner of A.K. Investments and Mr. Kantilal Lakshmichand. His telephone number 9619191999 appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip.

5.4.7 Shivcharan Shreedhar Kashyap – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 172417 -92833 Patch 2 +303057 -195693 iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip.

5.4.8 Divyesh Harish Surana – i. I submit that my trades were done in my name/code and for which I paid from my mapped bank account. My volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. I remained invested. My profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against me on the basis of (purported) 'connection' is erroneous. None was involved in my trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including me in the said group and tying me with them in the matter of my independent commercial transactions is wrong ii. My trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. My volume was – No. of shares No. of shares Patch 1 + 243660 -178932 Patch 2 +53992 -132466 iii. I am wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri, partner of A.K. Investments. His name appearing in my KYC on account of he being shown as an introducer has nothing to do with my trading in Exelon scrip.

5.4.9 A K Investments – i. We are a partnership firm (Partners: Amrit L. Gandhi and Kamlesh Maisheri) and engaged as an investor in capital market. We submit that my trades were done in my name/code and for which I paid from my mapped bank account. Our volume in Exelon was as shown in tables - not substantial. The trading in the scrip was in ‘T' group. We remained invested. Our profit was thus the outcome of deliveries based investment (in Exelon scrip) which is a permissible activity. The adverse finding of alleged illegal profits recorded against us on the basis of (purported) 'connection' is erroneous. No outside party was involved in our trading and settlement - pre-trade, trade and post-trade - and hence bunching, clubbing, lumping and including us in the said group and tying us with any party the matter of our independent commercial transactions is wrong.

ii. Our trading volume in Exelon scrip in the investigation period of 13 months was delivery based. Profit was not substantial considering my investment. Our volume was – No. of shares No. of shares Patch 1 + 353356 -353216 Patch 2 +10000 -10000 iii. We are wrongly treated as ‘connected’ with Mr. Kamlesh Maisheri - he is a partner of A.K. Investments. Our another partner is Amrit L. Gandhi and his residential address is B-35, Mahavir Apartment, Ratan Nagar, Borivali (E), Mumbai. Hence mere facts of partnership, address, mobile no. of partners do not mean anything. Seema Gandhi is wife of Amrit L. Gandhi and her off-market transaction with Divyesh Surana /Shivcharan Kashyap has not been found objectionable in the investigation report.

5.4.10 PVS Gangadhar Rao – i. “I don’t have any submission to make at this point of time regarding the findings contains in the SEBI Order dated June 7, 2016. ii. I request this Authority to grant me time till January 2017 to make payment of unlawful gains without interest as mentioned in the SEBI Order dated June 7, 2016. iii. I request this Authority to grant a waiver of interest of the unlawful gains alleged have been made by me in the SEBI Order dated June 7, 2016.”

5.4.11 Ms. Parvathaneni Mounisha (Represented by her father i.e. Mr. PVS Gangadhar Rao) – i. “I don’t have any submission to make at this point of time regarding the findings contains in the SEBI Order dated June 7, 2016. ii. I request this Authority to grant me time till January 2017 to make payment of unlawful gains without interest as mentioned in the SEBI Order dated June 7, 2016. iii. I request this Authority to grant a waiver of interest of the unlawful gains alleged have been made by me in the SEBI Order dated June 7, 2016.”

5.4.12 Mahindra Bhikaji Chile – i. “I don’t have any submission to make at this point of time regarding the findings contains in the SEBI order dated June 7, 2016. ii. I submit that the unlawful gains made in the scrip was done by my sub broker (Networth Stock Broking) and whatever profits earned in that scrip were transferred to Ms. Asha Singh account with blank cheque. iii. Thereafter my salary account was frozen.”

5.4.13 Satya Surya Narayana Jonnavittula – i. “I transferred 5000 shares to Shri, Vadlamudi Srikrishna through off market transactions. ii. I admit my mistake and it was not intentional and that mistake happened because I didn’t examine the transaction thoroughly.”

5.4.14 Hiten P Shah – i. “Mr. Srinivasa Rao Marupudi made me Director of Cementex because Mr. Marupudi had quite big amount of debits to be cleared so I was behind him for clearance for the same. ii. I don’t know anything about the said company nor have I attended any meeting.”

5.4.15 Anitha Yarlagadda – i. As regards the charge/finding of Violations under undisclosed off market transfers, it is submitted that the transactions shown are supported by stock market data may be right, however I never committed any mistake and never done any fraudulent acts with an intention to cause harm to the common investors as well as the market intermediaries and Regulatory mechanism. ii. It is also submitted that the I did not transfer any shares with an intention to gain any financial benefit, in fact client had transferred the shares with an intention to pledge them for meeting his financial needs, but neither he gets his shares back nor money against the shares transferred to others through off market.

5.4.16 Veerabhadra Rao Dandamudi – i. As regards the charge/finding of Violations under undisclosed off market transfers, it is submitted that the transactions shown are supported by stock market data may be right, however I never committed any mistake and never done any fraudulent acts with an intention to cause harm to the common investors as well as the market intermediaries and Regulatory mechanism. ii. It is also submitted that the I did not transfer any shares with an intention to gain any financial benefit, in fact client had transferred the shares with an intention to pledge them for meeting his financial needs, but neither he gets his shares back nor money against the shares transferred to others through off market. iii. It is also submitted that the Banking transactions done with Mr. Srikrishna Vadlamudi are normal Financial Transaction trading for the Past few years i.e. scrip is not being traded actively.

5.4.17 Gudimetla H Sunder – i. As regards the charge/finding of Violations under undisclosed off market transfers, it is submitted that the transactions shown are supported by stock market data may be right, however I never committed any mistake and never done any fraudulent acts with an intention to cause harm to the common investors as well as the market intermediaries and Regulatory mechanism. ii. It is also submitted that the I did not transfer any shares with an intention to gain any financial benefit, in fact client had transferred the shares with an intention to pledge them for meeting his financial needs.

5.4.18 Ramakrishna Makkena – i. As regards the charge/finding of Violations under undisclosed off market transfers, it is submitted that the transactions shown are supported by stock market data may be right, however I never committed any mistake and never done any fraudulent acts with an intention to cause harm to the common investors as well as the market intermediaries and Regulatory mechanism. ii. It is also submitted that the I did not transfer any shares with an intention to gain any financial benefit, in fact client had transferred the shares with an intention to pledge them for meeting his financial needs, but neither he gets his shares back nor money against the shares transferred to others through off market.

5.4.19 Sree Lakshmi Marupudi – i. As regards the charge/finding of Violations under undisclosed off market transfers, it is submitted that the transactions shown are supported by stock market data may be right, however I never committed any mistake and never done any fraudulent acts with an intention to cause harm to the common investors as well as the market intermediaries and Regulatory mechanism. ii. It is also submitted that the client did not transfer any shares with an intention to gain any financial benefit, in fact client had transferred the shares with an intention to pledge them to bring the money in to the company’s working capital, however efforts were not materialized and money could not be brought. iii. It is also submitted that being wife of Mr. Srinivasa Rao Marupudi, she might have shared her mobile No and address with Srinivasa Rao. But it does not mean that she done fraudulent acts.

5.4.20 Srinivasa Rao Marupudi – i. As regards the first charge/finding of Violations under PFUTP Regulations, it is submitted that the transactions shown under this Regulations supported by stock market data may be right, however Mr. Srinivasa Rao Marupudi and other allegedly connected persons namely, Mrs. Srilakshmi Marupudi, Mr. Sri Krishna Vadlamudi, Mr. Srinivas Yadav Sher, never committed any mistake and never done any fraudulent acts with an intention to cause harm to the common investors as well as the market intermediaries and Regulatory mechanism. ii. It is also submitted that Volume of transactions as shown in the SCN are result of Shifting of Shares from Clients one account to other account. It is also submitted that the client did not shift any shares with an intention to gain any financial benefit, in fact client had obliged to pay huge amount by way of brokerage. iii. It is submitted that Mr. Vadlamudi Srikrishna ( Noticee No-24), and Mr. Ramakrishna Makkena ( Noticee No-44), Mr. Gudimetla H Sunder (Noticee No.26), Ms Anitha Yarlagadda (Noticee No.45), Mr. Veerabhadra Rao Dandamudi (Noticee No. 49) are known to Mr. Srinivasa Rao Marupudi and they are not relatives, not in promoters group and not connected to company’s management or administration, hence they can never be called persons acting in concert.

5.4.21 Jayesh Himatlal Mehta – i. “I would like to mention that my name is included in the Group / Connected Entities wherein I have no directly or indirectly connection with any of the entities on as mentioned names on in the Table-A. ii. In this regards, I would like to mention that all the transaction are of normal business without involving or referring anybody. iii. In KYC Sr. 29 and mine having common address as mentioned on Table –A and I would like mention that Sr. No. 29, Smt. Nrupini Mehta is my wife, therefore the address is common and Sr. No. 30 Mr. Ronak Choksi as only as market friend and I have never dealt with any financial transaction/stock market relation transaction with him.”

Consideration of Issue and Findings –

5.5.1 As observed from the preceding paragraphs, in their submissions, the entities at paragraph 4.2 alongwith the entities mentioned at paragraph 4.3.2, have disputed the basis of the Impounding Order on the grounds that inter alia such Order did not consider correctly the individual trades of the aforesaid entities or the basis for their connection with each other and to the other entities mentioned therein.

5.5.2 As stated at paragraph 1.2 of this Order, an investigation in the scrip of Exelon was conducted for the period from December 8, 2010 to January 20, 2012, for ascertaining violations of the provisions of inter alia PFUTP Regulations, 2003; PIT Regulations, 1992 read with PIT Regulations, 2015, etc. I note that the aforesaid investigation in the matter has since been completed and the observations contained in the Investigation Report are subject to a final determination on merits by the Competent Authority. In furtherance of the same, SEBI has decided to initiate proceedings under Sections 11(4) and 11B, etc. of the SEBI Act and Adjudication proceedings under Sections 15HA and 15HB of the SEBI Act, against the entities mentioned at paragraph 12 of the Impounding Order dated June 7, 2016. SEBI shall endeavour to complete the aforesaid proceedings as expeditiously as possible, without being influenced by the observations and findings in this Order.

5.6.1 For the aforementioned reasons, the issue for determination in the instant proceedings is limited to whether the directions contained in the Impounding Order to the extent of liability for the alleged unlawful gains being joint and several, require revocation in light of the submissions made by the entities at paragraphs 4.2 and 4.3.2.

5.6.2 I note that under Section 11B read with Section 11(5) of the SEBI Act, SEBI has been entrusted with the power to direct any person, who made profit or averted loss by indulging in any transaction or activity in contravention of the provisions of that Act or Regulations made thereunder, to disgorge an amount equivalent to the wrongful gain made or loss averted by such contravention. It is pertinent to note that the aforesaid power has been entrusted upon SEBI to exercise in the interest of investors and for orderly development of the securities market. In this context, I note that vide the Impounding Order dated June 7, 2016, SEBI directed the impounding of an amount of ₹12,54,84,118, jointly and severally, from 52 entities mentioned at paragraph 12 of the aforesaid Order. The aforesaid Order was necessitated in furtherance of the mandate of investor protection; for safeguarding the interests of the securities market and for preventing diversion of unlawful gains so that such gains are secured till final disposal of the matter on determination of alleged culpability, if any, on the part of the entities mentioned therein. It was reasonable for SEBI to view the entities mentioned in the Impounding Order as a ‘Group’ in view of the connection that existed amongst them and also the impact their trading had on the scrip of Exelon, for making them jointly and severally liable for the alleged unlawful gains made/loss avoided while dealing in the said scrip. The Impounding Order therefore, suffers from no infirmity or lack of clarity when viewed in the aforesaid context.

5.6.3 In their submissions, the entities at paragraphs 4.2 and 5.4.1–5.4.9 have also contended that SEBI is not entitled to levy and recover interest @ 12% p.a. as claimed. Further, the aforesaid entities have also contended that the WTM, SEBI is not a ‘Court’ under the Interest Act, 1978 and has no power to levy as well as recover and also take coercive steps to enforce his own order of claim of interest. SEBI did not issue any notice in this regard and demanded the alleged profit. Hence for this reason, interest cannot be claimed.

5.6.4 In the Impounding Order dated June 7, 2016, interest on the unlawful gains were calculated for the period from June 14, 2011 to June 1, 2016. As regards the interest charged on the impounded amount, the observations of the Hon’ble SAT as contained in its Order dated July 27, 2000, passed in the matter of Bank of Baroda vs. SEBI (Appeal No. 2 of 200) and Union Bank of India (Appeal No. 4 of 200), which are reproduced below, are relevant to this case:

“… The argument put forth by the learned Counsel appearing for the Appellant Union Bank that the interest cannot be charged without specific statutory authorisation and that the Act does not empower the Respondent to charge interest, is correct. However, he appears to have missed the crucial fact that the Respondent had not charged interest but only asked to pay the interest accrued on the defaulted amount as provided under the law. It does not stand to reason that when the principal amount is paid, the interest legally accrued thereto, need not be paid. The interest payable on the defaulted amount is in reality a compensation for the delayed payment. Once the repayment is delayed liability to pay interest automatically sets in. That is what section 73 provides for. There is hardly any way to escape from this liability.”

5.6.5 In its Order dated August 22, 2016 (Misc. Application No. 174 of 2016 in Appeal No. 207 of 2016), the Hon’ble SAT observed –

6. “At this stage, Shri Chitale, learned Counsel for SEBI, on instruction, stated that if individual amounts (as recorded in Table-Q of the impugned order dated 07/06/2016) are deposited in escrow account as directed in para 15 of the impugned order, then the attachment qua the properties of the respective Appellant may be vacated. 7. After taking arguments of both parties into consideration, we feel it appropriate to direct the Respondents to limit the attachment to the actual amount of penalty in individual case and the remaining attachment in each individual case may be vacated in respect of the 6 Appellants. 8. We make it clear that if the learned Whole Time Member fails to pass an order as directed by this Tribunal vide its order dated 15th July 2016, and as amended by the present order, by 21st September 2016, the original interim order contained in the impugned order dated 7th June 2016 against the Appellants would stand vacated.”

5.6.7.1 I find that the following entities have deposited the amounts due from them as per the Impounding Order dated June 7, 2016, in the following manner –

SR. ENTITY TOTAL AMOUNT DATE WHEN AMOUNT IMPOUNDED WAS NO. (₹) DEPOSITED IN ESCROW ACCOUNT 1. AMRIT L GANDHI 226,538 21.06.2016 2. PARUL ANUPAM KHANNA 162,097 21.06.2016

5.6.7 In addition to the above, the following entity has tendered Demand Draft in respect of the amount due from him as per the Impounding Order dated June 7, 2016, –

SR. ENTITY TOTAL AMOUNT DATE WHEN AMOUNT IMPOUNDED WAS NO. (₹) TENDERED THROUGH DEMAND DRAFT 1. SATYA SURYA NARAYANA 15,459 22.06.2016 JONNAVITTULA

5.6.8 As stated earlier, it is reiterated that at this juncture, directions in the instant matter have to be limited to the quantum of amount to be deposited on an individual basis without going into the aspect of joint culpability of entities mentioned in the Impounding Order.

5.6.9 On considering the totality of the facts and circumstances, the interests of securities market and my observations/reasoning as detailed at paragraphs 5.5.1–5.6.8, I am of the considered view that the following Order will meet the ends of justice.

Order –

6.1 I, in exercise of the powers conferred upon me in terms of Section 19 read with Sections 11 and 11B of the SEBI Act, direct as follows –

6.2.1 The following entities have deposited the individual amounts due from them as per the Impounding Order dated June 7, 2016, in the following manner –

SR. NO. ENTITY TOTAL AMOUNT DATE WHEN AMOUNT IMPOUNDED WAS DEPOSITED IN (₹) ESCROW ACCOUNT/ TENDERED THROUGH DEMAND DRAFT 1. AMRIT L GANDHI 226,538 21.06.2016 2. PARUL ANUPAM KHANNA 162,097 21.06.2016 3. SATYA SURYA NARAYANA 15,459 22.06.2016 JONNAVITTULA

6.2.2 Accordingly, the Impounding Order dated June 7, 2016, stands vacated as against them.

6.3.1 The following entities are liable for the alleged unlawful gains indicated against their respective names as under –

SR. NO. NAME OF ENTITY PAN TOTAL AMOUNT (₹) 4. SHIVANGI JAGMOHAN SINGH AOSPS5911E 610,850 5. SEEMA GANDHI AAEPG0960B 2,836,590 6. AMRIT L GANDHI AACPG5265H 226,538 7. PARUL ANUPAM KHANNA BCUPK8420R 162,097 8. CEMENTEX (INDIA) PRIVATE LIMITED AAACC9265A 12,437,393 9. SRINIVASA RAO MARUPUDI ACQPM0876L, BCDPM3124P 739,799 10. SRINIVAS YADAV SHER AUAPS8547G 922,255 11. SHAIK AMEER BASHA AEZPB3408A 1,599 12. SREE LAKSHMI MARUPUDI ALYPM2964Q 86,259 13. HITEN VALLABHJI HARIA AAAPH6890H 16,229,057 14. A. K. INVESTMENTS AANFA6009Q 8,061,432 15. NARENDRA OMPRAKASH DOGRA AJMPD8729N 3,191,865 16. KANTA ANANTRAI DESAI AAEPD6006F 2,872,525 17. ANJALI TUKARAM SOGAM CGNPS1443N 2,327,126 18. JITENDRA L. GANDHI AACPG6473H 4,437,771 19. GANGADHARA RAO ILAPARTI AANPI9650F 1,880,521 20. HUSSAIN MOHAMMED SHAIKH BSSPS2832P 1,864,154 21. JIGNA MANISH SHAH ANQPS6789P 2,370,223 22. SNEHA PANKAJ DESAI AIBPD1454A 1,194,430 23. NISHITA DANISH MERCHANT AMHPM8133B 1,144,119 24. DHANA ENERGY P. LIMITED AACCV7693M 2,987,256 25. SRIKRISHNA VADLAMUDI ADNPV5504C 1,135,191 26. KANTILAL LAKSHMICHAND ADSPK7577K 1,097,926 27. GUDIMETLA H SUNDER BMLPS9664N 1,619,909 28. DIMPLE PANKAJ DESAI AUQPD3909F 607,390 29. P. V. S. GANGADHARA RAO AKYPP5600M 599,684 30. SUNIL KUMAR H. PAL BKSPP6938B 867,090 31. VENKATA SUBBARAO YARRA AAPPY4270P 257,879 32. YENTRAPATI RAVI ABWPY6767F 198,398 33. HITEN P. SHAH AHAPS0889A 2,440,527 34. PARVATHANENI MOUNISHA BAOPP1399G 104,024 35. SWAPNA SRI TUMMALA ALDPT7720Q 72,606 36. PIYUSH NARESH KOTHARI AEOPK1882L 7,364 37. NRUPINI JAYESH MEHTA BDTPM2261E 836,638 38. MAHENDRA BHIKAJI CHILE AHNPC8127G 561,412 39. ELUBANDI SATYANARAYANA DGCPS7022F 246,541 40. RAMA KRISHNA MAKKENA BCKPK1101P 857,516 41. ANITHA YARLAGADDA ACAPY5774B 2,110,192 42. SALMA SHARAFAT KHAN BVSPK9348F 6,231,170 43. RONAK ASHWIN CHOKSI ADDPC2938D 14,662,936 44. VEERABHADRA DANDAMUDI ABVPD6656R 1,752,985 45. DIVYESH HARISH SURANA DALPS0578H 9,067,380 46. JAYESH HIMATLAL MEHTA AIFPM2216D 4,557,416 47. SHIVCHARAN SHREEDHAR KASHYAP ATOPK6636K 3,078,389

6.3.2 The directions against the aforementioned entities at paragraph 6.3.1 in respect of their bank accounts/demat accounts/properties (as contained in the Impounding Order dated June 7, 2016), shall be restricted to their respective individual amounts. The Impounding Order dated June 7, 2016, shall stand vacated as against them if the aforesaid individual amounts are credited to the Escrow Account. On production of proof that their individual amounts is deposited in the Escrow Account, SEBI shall communicate to the Banks and Depositories to defreeze the accounts.

6.4 This Order shall be read with the Impounding Order dated June 7, 2016.

Place: Mumbai S. RAMAN Date: September 21, 2016 WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA