Order in the matter of Mishka Finance and Trading Ltd

WTM/GM/IVD/ID6/9588/2020-21 SECURITIES AND EXCHANGE BOARD OF INDIA FINAL ORDER Under sections 11(1), 11(4) and 11B of the Securities and Exchange Board of India Act, 1992 in the matter of Mishka Finance and Trading Limited (formerly known as Pyramid Trading and Finance Limited) In respect of:

Noticee Noticee PAN No. No.

1 Mishka Finance and Trading Limited AAACP2548R

2 Ankit Garodia ARRPG4567A

3 Jugalkishore Pralhadrai Sharma ABLPS6840A

4 Amit Kumar Vasishtha AKNPV5025B

5 Rameshwar Manohar Wagh ABLPW8901G

6 Anand Gupta AFNPG7938K

7 Vijay Kumar Jain AAAPJ3197K

8 Anil Satyanarayan Roongta ABBPR3992G

9 Sudha Anil Roongta AAQPR4466F

10 Pawan Darak AAAPD9261A

Order in the matter of Mishka Finance and Trading Limited

11 Megha Ravi Wattamwar AAAPW9319A

12 A. K. Roongta Huf AABHA9528A

13 Vijay Kumar Soni Huf AAGHV5661L

14 Ritu S Saraf AAHPB4095P

15 Kanta Balkishan Jaju AAJPJ4245M

16 Ravi B Wattamwar Huf AALHR3103E

17 Disposed by way of Settlement order Dated September 24, 2020

18 Sunita Toshniwal AANPT7118D

19 Sanjay Ambadas Joshi ABGPJ9472Q

20 Vinita Sanjay Joshi ABGPJ9502P

21 Kiran Narayanprasad Toshniwal ABHPT5940L

22 Tejal Piyush Mehta ABQPM1056P

23 Sainik Kumar Jain ABYPJ9823B

24 Disposed by way of Settlement order Dated September 24, 2020

25 -do-

26 -do-

27 Sorabh Kumar Poddar AELPP0173Q

28 Rupesh Poddar AELPP0183N

29 Disposed by way of Settlement order Dated September 24, 2020

30 -do-

31 Hemraj Raneja AFOPR0263B

32 Tushar Ashok Thakur AFZPT5149K

33 Sunayana Jain AGBPJ8881F

34 Disposed by way of Settlement order Dated September 24, 2020

35 Kiritkumar Ramniklal Mehta AHXPM6863F

36 Anand Raneja AIUPR9150N

37 Mansi Manoj Rane AJFPR5740L

38 Vikram Navinchanra Shah AKCPS7427B

39 Parul Poddar AKKPP3508Q

40 Ketan Jumakhlal Mehta AMHPM0156A

41 Usha Rakeshkumar Dixit AMYPD3165F

42 Sandeep V Saraf ANQPS5905F

43 Neha Narayan Toshniwal ANZPT6807C

44 Manish Kumar Bhati APPPB5638F

45 Savita Soni ASZPS1277J

46 Priyanka Pramod Mhapsekar ATRPM4285D

47 Disposed by way of Settlement order Dated September 24, 2020

48 -do-

49 Tejas Gala AZAPG1972C

50 Mukesh Kumar BAPPK2160M

51 Kavita Raneja BNNPK9250R

52 Ashish Ishwarlal Shah BPXPS8075L

53 Omprakash Sharma BQFPS5917N

54 Disposed by way of Settlement order Dated September 24, 2020

55 -do-

56 -do-

57 Asifatanveer M Shaikh CNAPS8962G

58 Chandravati M Shah AAKPS3275M

59 Manharlal N Shah AAKPS3276J

60 Nikunj S Agarwal AYOPA2382B

* In the present proceedings the number of Noticees involved, after the disposal of Settlement Applications is 48. For the sake of convenience, the number assigned to each of the Noticee in the Show-Cause Notice dated December 12, 2017 has been retained in the present Order.

Background –

1. Pursuant to detection of a huge rise in the traded volume and price of the scrip of Mishka Finance and Trading Limited (“Mishka”/ the “Company”), formerly known as Pyramid Trading and Finance Limited, on the Bombay Stock Exchange Limited (“BSE”), SEBI conducted an investigation to ascertain the violation of the provisions of the Securities and Exchange Board of India Act, 1992 (the “SEBI Act”) and SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 (the “PFUTP Regulations”) in the scrip for the period, February 14, 2013 to December 31, 2014 (the “Investigation Period”). The price of the shares of Mishka, moved from Rs.5.50 on February 14, 2013 to Rs.327.25 on January 15, 2014. Further to the above, the share of Mishka was split, from one share of face value Rs.10 to 10 shares of face value Rs.1 each on January 16, 2014. Thereafter, the price of the scrip touched a high of Rs.49.90 on February 14, 2014.

2. Upon preliminary inquiry, SEBI prima facie observed that Mishka made a preferential allotment during 2012-13. Once the shares were allotted to the preferential allottees/promoter related group, certain entities started moving the price of the scrip upwards by trading in very low volumes. Subsequent to the release of compulsory lock-in period for 1 year, the Preferential Allottees and the Promoter related entities were provided exit at a high price by certain entities allegedly related/connected amongst themselves and with Mishka.

3. By virtue of the same, it was alleged that the Company and persons in charge of its affairs created preferential allotment of shares as a mode to provide fictitious long term capital gains (“LTCG”) to its Preferential Allottees and Promoter related entities so as to convert their unaccounted income into accounted one; its Promoters/Directors, Exit Providers, Preferential Allottees and the Promoter related entities artificially increased the volume and price of the scrip and misused securities market system for making illegal gains and to convert ill-gotten gains into genuine one to avail LTCG.

4. Accordingly, the following actions were initiated in the matter:

Table – 1

Sl. No. Event Date

Ad interim ex-parte order (“Interim Order”) passed by SEBI 1. upon the finding that Mishka and its Promoters, Directors and other suspected entities totalling to 129 were prima facie in violation of the SEBI Act and the PFUTP Regulations, and as April 17, such the said entities were restrained from accessing the 2015 securities market and further prohibited from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, till further directions.

Order passed by SEBI revoking the directions issued against 2. November Jayesh N Kesharia, one of the 129 entities mentioned in the 10, 2015 above-mentioned Interim Order.

Order passed by SEBI revoking the directions issued against August 26, 3. Bharat Bagriand and Manjulaben Sukhdev, part of the 129 2016 entities mentioned in the above-mentioned Interim Order.

October 12, 2015; October 21, 2015; Confirmatory Orders numbering total of six (6) passed by SEBI November 4. confirming the directions passed against the remaining 126 10, 2015; entities April 13, 2016; July 05, 2016; and August 26, 2016

Order issued by SEBI revoking directions issued against 113 entities* vide the above-mentioned Interim Order, and confirmed thereto by the confirmatory orders mentioned above. *Subsequent to the Interim Order and confirmatory orders thereto, SEBI conducted a detailed investigation with respect to the remaining 126 entities. Upon completion of investigation, no adverse findings were made out against 104 entities with respect to their role in the price manipulation /prima facie warranting 5. October continuation of action under Sections 11B and 11(4) of the SEBI 05, 2017 Act for the violation of provisions of SEBI Act and PFUTP Regulations. Further with regard to 9 entities, no adverse material was found in the Investigation Report with respect to prima facie violations found against them in the Interim Order, and subsequently confirmed. The Investigation Report, though, brought out violations relating to disclosure under SEBI (Prohibition of Insider Trading) Regulations, 1992 and SEBI (Substantial Acquisition of Shares And Takeovers) Regulations, 2011 warranting Adjudication Proceedings in respect of the 9 entities. Therefore, the said Order was passed revoking the directions against 113 entities.

5. From the above chronology, it follows that the Interim order was not revoked against 13 entities, i.e. Noticee Nos.1, 2, 3, 4, 5, 7, 8, 12, 25, 26, 28, 39 and 59 named in the SCN, after a detailed investigation.

The Show-cause Notice

6. Accordingly, based on the investigation, a common Show Cause Notice dated December 12, 2017 (the “SCN”) was issued to 60 Noticees (13 Noticees against whom the Interim Order was not revoked and 47 new Noticees) named above, calling upon the said Noticees to show cause as to why suitable directions under sections 11(1), 11(4) and 11B of the SEBI Act, 1992 should not be issued against them for the allegations contained therein.

7. The substantive allegations contained in the SCN are provided hereunder:

False and Misleading Objects of the Preferential Issue (Noticee Nos. 1 to 7)

7.1. The Company on September 24, 2012 issued 7,93,700 shares on preferential basis to 46 entities at Rs.85 per share (Face value of Rs.10 per share at premium of Rs.75 per share). Before the preferential allotments, the company had a total shareholding of 4,98,000 shares. It was observed that one Preferential Allottee, namely Pearl Arcade Trading Pvt Ltd was introduced as a Promoter of the Company. The shares issued under preferential allotment were under lock-in till September 23, 2013.

7.2. It was observed that the special resolution passed under section 81(1A) of the Companies Act, 1956, disclosed the following purposes for fund raising through preferential allotment:

▪ Capital expenditure including acquisition of company/business;

▪ Funding long term working capital requirements; ▪ Marketing ▪ Setting up of offices abroad; and ▪ For other approved corporate purposes.

7.3. Upon investigation in the matter, it was observed that there were neither additions to the fixed assets of the Company nor any mention of capital work-in-progress. Further, the cash flow statement for these years did not have any cash flow relating to acquisition and development of moveable and immovable property (i.e. negative cash flow from investing activities); on the contrary company sold its existing investments in the F.Y. 2012-13 and 2013-14. It was also observed that Mishka instead of utilising the preferential issue proceeds for the purpose, as stated in the notices of the general meetings wherein preferential allotments of shares were approved, used it for extending loans & advances etc.

7.4. Thus, the SCN has alleged that Mishka (Noticee No. 1) and its six directors (Noticee No. 2 to 7) during the financial years 2012-13 & 2013-14 namely Ankit Om Prakash Garodia, Jugalkishore Sharma, Amit Kumar Vasishtha, Rameshwar Manohar Wagh, Anand Gupta and Vijay Kumar Jain, presented false and misleading objects of the preferential issue to shareholders in Notice of General Meeting of the members of the Company held on September 03, 2012, and as such, Noticee Nos. 1 to 7 are alleged to have violated Section 12A (a), (b) and (c) of SEBI Act, 1992 read with Regulations 3 (a), (b), (c), (d), 4(1), 4(2)(f)(k) and (r) of SEBI (PFUTP) Regulations, 2003.

Manipulation of the Share Price of the Company (Noticee Nos. 8 to 60)

7.5. As on September 30, 2011, the total shareholding of the Company was 4,98,000 shares (held by seven entities and entire shares were in physical mode) of which 4,19,700 shares i.e. 84.28% of total shareholding were held by four Promoter entities, namely, Embassy Finance & Consultants Pvt Ltd, Wave Inter Trades Pvt Ltd, Tohee Trading & Agencies Pvt Ltd, and Sulabh Impex Limited and remaining 78,300 shares i.e. 15.72% of total shareholding were held by three entities namely Vijay Kumar Jain, Ankit Jain and Rashmi Jain, the details of which are as follows:

Table-2

Sr. No. Name Category No. of % of Total Shares Paid up Held Capital As on 30-Sep-2011 1 Embassy Finance & Consultants Promoter 1,24,500 25.00% Pvt Ltd Promoter 2 Tohee Trading & Agencies Pvt Ltd 1,21,200 24.34% Promoter 3 Wave Inter Trades Pvt Ltd 1,24,000 24.90% Promoter 4 Sulabh Impex Limited 50,000 10.04% Total Promoter Shareholding (A) 4,19,700 84.28% 5 Vijay Kumar Jain Director 36,000 7.23% Son of Director 6 Ankit Jain 32,000 6.42% Wife of 7 Rashmi Jain 10,300 2.07% Director Total Non Promoter Shareholding (B) 78,300 15.72%

Total Shareholding of the company (A+B) 4,98,000 100.00%

7.6. It was observed during investigation that the above seven entities were connected to each other. Thus, the entire shareholding of the Company was with the aforesaid seven connected entities only, as on 30 September, 2011.

7.7. On December 26, 2011, Sulabh Impex Limited transferred its entire shareholding of 50,000 shares to Ankit Jain through an off-market transfer. Thereafter, six entities (four Promoter entities namely, Tohee Trading & Agencies Pvt Ltd, Wave Inter Trades Pvt Ltd, Embassy Finance and Consultants Pvt Ltd and Vijay Kumar Jain and relatives of Promoter namely Ankit Jain and Rashmi Jain) transferred their entire shareholding (except 2,000 shares of Embassy Finance & Consultants Pvt Ltd) i.e. 4,96,000 in off-market transactions in physical form to 383 entities during the period, December 30, 2011 to February 04, 2013 on 12 dates. Six Promoters and Promoter related entities, stated in their replies that they sold the shares through Roongta Rising Stock Private Limited (hereafter referred as “RRSPL”) and received the payment of Rs. 21,21,500 (85.54%) directly from RRSPL and Rs. 3,58,500 (14.46%) from the buyers as per instructions of RRSPL. These entities provided copies of bank statements showing payment received from RRSPL and a copy of letter issued by RRSPL to accept Rs.3,58,500 (14.46%) directly from the buyers.

7.8. Investigation revealed that six Promoters and Promoter related entities had transferred 99.60% of their shareholding (4,96,000 shares) to 383 entities and out of which 19 entities further transferred to 69 entities. Therefore ultimately, 99.60% of promoter shareholding was transferred to 452 entities.

7.9. The entities (who received shares in off-market from six promoters and promoter related entities), except Anil Satyanarayan Roongta, A. K. Roongta HUF and Sudha Anil Roongta which are entities related to Roongta, stated that they came to know about shares of Mishka from a newspaper advertisement published by RRSPL.

7.10. Accordingly, the SCN has alleged that RRSPL devised a scheme to manipulate the price of the scrip by issuing an advertisement buying shares from the promoter entities and manipulating the price of the scrip. As a Company functions through its directors, Anil Satyanarayan Roongta and Sudha Anil Roongta (Noticee No. 8 and 9) being directors of RRSPL, were alleged to have violated the provisions of Regulations 3(a)(b)(c)(d) and 4(1) of SEBI (PFUTP) Regulations, 2003.

7.11. Further, 53 entities (Noticee No. 8 to 60) were alleged to have indulged in an act amounting to manipulation of price of the scrip in Patch-1 and Patch-2. Further, these noticees, except Noticee No. 58 to 60, namely Chandravati M Shah, Manharlal N Shah and Nikunj S Agarwal, are also alleged to have sold the shares at inflated price and booked substantial profit. Hence, the 53 entities (Noticee No. 8 to 60) have been alleged to have violated Regulation 3(a),(b),(c),(d) and Regulation 4(1), 4(2) (a) & 4(2) (e) of SEBI (PFUTP) Regulations, 2003.

Inspection, Personal Hearing and Replies of Noticees

8. The SCN was served on all the Noticees. Pursuant to the SCN, some of the Noticees filed their replies. Some of the Noticees also sought inspection of documents. Based upon the request of the Noticees, an opportunity of inspection of the records/ documents (which were relied upon by SEBI for the purpose of the SCN) was provided to the Noticees. Details with respect to the same are provided hereunder:

Table- 3

Noticees Status Inspection of Documents 1. Mishka Finance and Service complete Trading Limited 2. Ankit Garodia Service complete 3. Jugalkishore Pralhadrai Service complete Sharma 4. Amit Kumar Vasishtha Service complete 5. Rameshwar Manohar Service complete Wagh 6. Anand Gupta Service complete 7. Vijay Kumar Jain Service complete 8. Anil Satyanarayan Service complete Yes Roongta 9. Sudha Anil Roongta Service complete Yes 10. Pawan Darak Service complete 11. Megha Ravi Wattamwar Service complete Yes 12. A K Roongta Huf Service complete Yes 13. Vijay Kumar Soni Huf Service complete 14. Ritu S Saraf Service complete 15. Kanta Balkishan Jaju Service complete

16. Ravi B Wattamwar Huf Service complete Yes 18. Sunita Toshniwal Service complete 19. Sanjay Ambadas Joshi Service complete Yes 20. Vinita Sanjay Joshi Service complete Yes 21. Kiran Narayanprasad Service complete Toshniwal 22. Tejal Piyush Mehta Service complete 23. Sainik Kumar Jain Service complete 27. Sorabh Kumar Poddar Service complete 28. Rupesh Poddar Service complete Yes 31. Hemraj Raneja Service complete 32. Tushar Ashok Thakur Service complete 33. Sunayana Jain Service complete 35. Kiritkumar Ramniklal Service complete Mehta 36. Anand Raneja Service complete 37. Mansi Manoj Rane Service complete 38. Vikram Navinchanra Service complete Shah 39. Parul Poddar Service complete Yes 40. Ketan Jumakhlal Mehta Service complete 41. Usha Rakeshkumar Dixit Service complete 42. Sandeep V Saraf Service complete 43. Neha Narayan Toshniwal Service complete 44. Manish Kumar Bhati Service complete 45. Savita Soni Service complete 46. Priyanka Pramod Service complete Mhapsekar 49. Tejas Gala Service complete 50. Mukesh Kumar Service complete 51. Kavita Raneja Service complete

52. Ashish Ishwarlal Shah Service complete 53. Omprakash Sharma Service complete 57. Asifatanveer M Shaikh Service complete 58. Chandravati M Shah Service complete 59. Manharlal N Shah Service complete 60. Nikunj S Agarwal Service complete

9. Subsequent to the issuance of the SCN, the Noticees filed settlement applications under SEBI (Settlement Proceedings) Regulations, 2018 during the pendency of the current proceedings. The table listing the Noticees from whom Settlement Applications were received is placed hereunder:

Table- 4

Settlement Applications Sl. Noticee Application Applications Rejected/ No. No. Noticee No. Accepted Withdrawn Amitkumar Madanlal 1 4 Vasistha 3996 of 2019 _ Yes

2 5 Rameshwar Manohar Wagh 3992 of 2019 _ Yes

3 8 Anil Satyanaryan Roongta 3968 of 2019 _ Yes

4 9 Sudha Anil Roongta 3969 of 2019 _ Yes

5 10 Pawankumar Motilal Darak 3988 of 2019 _ Yes

6 12 A. K. Roongta (HUF) 3970 of 2019 _ Yes

7 14 Ritu S Saraf 3995 of 2019 _ Yes

8 15 Kanta Balkishan Jaju 4077 of 2019 _ Yes Settlement Order dated September 24, 9 17 Atul Sumatilal Kankaria 3999 of 2019 2020 _

10 18 Sunita Toshniwal 3994 of 2019 _ Yes Kiran Narayanprasad 11 21 Toshniwal 3990 of 2019 _ Yes

12 23 Shrenik Kumar Jain 3997 of 2019 _ Yes Settlement Order dated September 24, 13 24 Jugal Ramesh Deorah 3986 of 2019 2020 _ Settlement 3982 of 2019 Order dated and 3904 of September 24, 14 25 Atul Moreshwar Save 2019 2020 _ Settlement 3983 of 2019 Order dated and 3904 of September 24, 15 26 Pritishkumar Chaterjee 2019 2020 _

Settlement 3984 of 2019 Order dated and 3904 of September 24, 16 29 Anjali Save 2019 2020 _ Settlement 3985 of 2019 Order dated and 3904 of September 24, 17 30 Tripti Chatterjee 2019 2020 _ Settlement Order dated September 24, 18 34 Sonal Jugal Deorah 3987 of 2019 2020 _

19 42 Sandeep V Saraf 3991 of 2019 _ Yes

20 43 Neha Narayan Toshniwal 3998 of 2019 _ Yes Settlement Order dated September 24, 21 47 Harshal Ashok Kumat 3993 of 2019 2020 _ Settlement Order dated Atul Sumatilal Kankaria September 24, 22 48 (HUF) 4000 of 2019 2020 _ Settlement Order dated September 24, 23 54 Jay Ketan Somaiya 3989 of 2019 2020 _

Settlement Order dated Kajalkiran Sumatilal September 24, 24 55 Kankaria 4002 of 2019 2020 _ Settlement Order dated September 24, 25 56 Priyanka Atul Kankaria 4001 of 2019 2020 _

10. As would be evident from the above table, certain settlement applications were withdrawn before their disposal by the respective Noticees. The settlement applications from the remaining Noticees were disposed of by an Order dated September 24, 2020, as detailed in the table above.

11. Opportunities of personal hearings were granted to the Noticees on May 23, 2018 and July 24, 2018. However, as settlement applications had been filed by certain Noticees (listed out in Table – 4 above), whose roles in the matter had a distinct connection with the other Noticees; the present proceedings could not have been concluded before the disposal of the said Settlement Applications. Further opportunity of personal hearing was granted on August 28, 2020 to certain Noticees, who had sought an extension of time for personal hearing and to certain other Noticees who had not appeared for personal hearing before. Further to the said hearing on August 28, 2020, an opportunity was provided to the Noticees who had been heard to submit written submissions, if they so wished. Furthermore, a final opportunity by way of letter dated October 22, 2020 was provided to all the Noticees— excluding the Noticees who were heard on August 28, 2020 — to submit any additional submissions, if they so wished. The Settlement Applications having been disposed of by an Order dated September 24, 2020, and the rest of the Noticees having been provided adequate opportunities to place their case before me, I find that the present proceedings is ready for consideration and final disposal. In this regard, a list of the Noticees who entered appearance before me along with the details of their representatives etc. is as under:

Table-5

Noticee Date of Hearing Designation Noticee Represented By No. Mishka Finance and May 23, 2018 Chartered 1 Ravi Ramaiya Trading Limited Accountant May 23, 2018 Chartered 2 Ankit Garodia Ravi Ramaiya Accountant Jugalkishore Pralhadrai May 23, 2018 Chartered 3 Ravi Ramaiya Sharma Accountant May 23, 2018 Advocate 4 Amit Kumar Vasishtha Saurabh Bachhawat May 23, 2018 Advocate 5 Rameshwar Manohar Wagh Saurabh Bachhawat May 23, 2018 Company 6 Anand Gupta Deepak Sharma Secretary May 23, 2018 Company 7 Vijay Kumar Jain Deepak Sharma Secretary July 24, 2018; Chartered 8 Anil Satyanarayan Roongta August 28, 2020 Ravi Ramaiya Accountant

July 24, 2018; Chartered 9 Sudha Anil Roongta August 28, 2020 Ravi Ramaiya Accountant

July 24, 2018; Saurabh Advocate 10 Pawan Darak August 28, 2020 Bachhawat/Jaikishan Lakhwani 11 Megha Ravi Wattamwar July 24, 2018 Prakash Shah Advocate July 24, 2018 Chartered 12 A. K. Roongta Huf Ravi Ramaiya Accountant 13 Vijay Kumar Soni Huf July 24, 2018 Pulkit Sharma Advocate July 24, 2018; Advocate Pulkit Sharma/ 14 Ritu S Saraf August 28, 2020 Jaikishan Lakhwani May 23, 2018; Advocate Sameer Khedekar/ 15 Kanta Balkishan Jaju August 28, 2020 Jaikishan Lakhwani 16 Ravi B Wattamwar Huf July 24, 2018 Prakash Shah Advocate July 24, 2018; Advocate Saurabh Bachhawat/ 18 Sunita Toshniwal August 28, 2020 Jaikishan Lakhwani July 24, 2018 Chartered 19 Sanjay Ambadas Joshi Ketan Rupani Accountant July 24, 2018 Chartered 20 Vinita Sanjay Joshi Ketan Rupani Accountant July 24, 2018; Advocate Kiran Narayanprasad Saurabh Bachhawat/ 21 August 28, 2020 Toshniwal Jaikishan Lakhwani August 28, 2020 - 22 Tejal Piyush Mehta Self May 23, 2018; Saurabh Advocate Sainik Kumar Jain/Shrenik 23 August 28, 2020 Bachhawat/Ravi Kumar Jain Ramiya 27 Sorabh Kumar Poddar July 24, 2018 Prakash Shah Advocate July 24, 2018 Advocate 28 Rupesh Poddar KRCV Seshachalam July 24, 2018 Chartered 31 Hemraj Raneja Nikunj Kanodia Accountant July 24, 2018 Chartered 33 Sunayana Jain Nikunj Kanodia Accountant

Kiritkumar Ramniklal August 28, 2020 - 35 Self Mehta July 24, 2018 Chartered 36 Anand Raneja Nikunj Kanodia Accountant May 23, 2018 - 38 Vikram Navinchanra Shah Self July 24, 2018 Advocate 39 Parul Poddar KRCV Seshachalam August 28, 2020 - 40 Ketan Jumakhlal Mehta Self May 23, 2018 - 41 Usha Rakeshkumar Dixit Self July 24, 2018; Advocate Pulkit Sharma/ 42 Sandeep V Saraf August 28, 2020 Jaikishan Lakhwani July 24, 2018; Advocate Saurabh Bachhawat/ 43 Neha Narayan Toshniwal August 28, 2020 Jaikishan Lakhwani August 28, 2020 - 44 Manish Kumar Bhati Self 45 Savita Soni July 24, 2018 Pulkit Sharma Advocate Priyanka Pramod August 28, 2020 - 46 Self Mhapsekar August 28, 2020 - 49 Tejas Gala Self July 24, 2018 Chartered 51 Kavita Raneja Nikunj Kanodia Accountant August 28, 2020 - 52 Ashish Ishwarlal Shah Self

12. Noticees Nos. 32, 37, 50, 57, 58, 60 neither availed the opportunity of personal hearing nor filed any reply. The details with respect to the service of the SCN and Hearing Notices to the said Noticees is provided hereunder:

Table-6 Sl. Noticee Details No. 1 Tushar Ashok Thakur, Noticee No. 32  The SCN dated December 12, 2017 was sent by Speed Post to the said Noticee at the address: Dhutum Nagar, Jarimari Mnadir, PO Jasai Tal, Uran, Raigad, Maharashtra-400072. As per the acknowledgement, the same was received by Shri Shanta Ashok Thakur on December 27, 2017.  The SCN dated December 12, 2017 was again sent by way of letter dated March 19, 2018 through Speed Post to the Noticee at the above-mentioned address. As per the acknowledgement, the same was received by Tushar Thakur.  Letter dated October 22, 2020 was sent to the Noticee providing him an opportunity to file written submissions in response to the SCN. The said letter was also emailed to the Noticee on the email ID : tushar2813@gmail.com 2 Mansi Manoj Rane, Noticee No. 37  The SCN dated December 12, 2017 was sent by Speed Post to the said Noticee at the address: 3, Saigeeta Building, Goddev Phatak Road, Opposite Ashwini Hospital, Bhayander East, Thane -

401105. As per the acknowledgement, the same was delivered.  The SCN dated December 12, 2017 was again sent by way of letter dated March 19, 2018 through Speed Post to the Noticee at the above-mentioned address. As per the acknowledgement, the same was delivered.  Hearing Notice dated April 26, 2018 was sent to the Noticee at the above-mentioned address through Speed Post, informing her of the personal hearing scheduled before WTM on May 23, 2018. The same was returned to SEBI.  A copy of the above-mentioned Hearing Notice was affixed at the address of the Noticee on May 11, 2018.  Letter dated October 22, 2020 was sent to the Noticee providing her an opportunity to file written submissions in response to the SCN. As per the tracking record the same was delivered. The said letter was also emailed to the Noticee on the email ID : rane.mansi@yahoo.co.in 3 Mukesh Kumar, Noticee  The SCN dated December 12, 2017 was sent by No. 50 Speed Post to the Noticee at the address: 222 B, Gaiwadi Road, Vigas Street, Keval Cross Lane, Chira Bazar, Mumbai -400002. As per the tracking record the same could not be delivered and returned to SEBI.

 The SCN dated December 12, 2017 was affixed at the address of the said Noticee on January 17, 2018.  Hearing Notice dated April 26, 2018 was sent to the Noticee at the above-mentioned address through Speed Post, informing him of the personal hearing scheduled before WTM on May 23, 2018. The same was returned to SEBI as the same could not be delivered.  A copy of the above-mentioned hearing Notice was affixed at the address of the said Noticee on May 02, 2018.  Letter dated October 22, 2020 was sent to the Noticee providing him an opportunity to file written submissions in response to the SCN. 4 Asifatanveer M Shaikh,  The SCN dated December 12, 2017 was sent by Noticee No. 57 Speed Post to the Noticee at the address: 6, Anusuya Bhagwanchi Chawl, Cama Road, Gaon Devi Dongri, Andheri (W), Mumbai- 400 058. As per the tracking record, the same could not be delivered and was returned to SEBI.  The SCN dated December 12, 2017 was affixed at the address of the Noticee on January 17, 2018.  Hearing Notice dated April 26, 2018 was sent to the Noticee at the above-mentioned address through Speed Post, informing him of the personal hearing scheduled before WTM on May 23, 2018.

The same was returned to SEBI as the same could not be delivered.  A copy of the above-mentioned Hearing Notice was affixed at the address of the Noticee on May 02, 2018.  Letter dated October 22, 2020 was sent to the Noticee providing her an opportunity to file written submissions in response to the SCN. The said letter was also emailed to the Noticee on the email ID : shaikhasifa03@gmail.com 5 Chandravati M Shah,  The SCN dated December 12, 2017 was sent by Noticee No. 58 Speed Post to the Noticee at the address: B/208, North Avenue, Adarsh Vihar Complex, Off Marve Road, Malad W, Mumbai -400064. As per the acknowledgement, the same was delivered.  The SCN dated December 12, 2017 was again sent by way of letter dated March 19, 2018 through Speed Post to the Noticee at the above-mentioned address. As per the acknowledgement, the same was delivered.  Hearing Notice dated April 26, 2018 was sent to the Notice at the above-mentioned address through Speed Post, informing her of the personal hearing scheduled before WTM on May 23, 2018. As per the acknowledgement, the same was delivered.

 Hearing Notice dated June 21, 2018 was sent to the said notice at the above-mentioned address through Speed Post, informing her of the personal hearing scheduled before WTM on July 24, 2018.  Letter dated October 22, 2020 was sent to the Noticee providing her a final opportunity to file written submissions in response to the SCN. 6 Nikunj S Agarwal, Noticee  The SCN dated December 12, 2017 sent by speed No. 60 post to the said Noticee at the address: B-403/404, Lake Lucerne, Lake Homes, Off Adi Sankaracharya Marg, Powai, Mumbai- 400076. As per the tracking record, the same was delivered.  The SCN dated December 12, 2017 was again sent by way of letter dated March 19, 2018 through Speed Post to the said Noticee at the above-mentioned address. As per the acknowledgement, the same was delivered.  Hearing Notice dated April 26, 2018 was sent to the said notice at the above-mentioned address through Speed Post, informing her of the personal hearing scheduled before WTM on May 23, 2018. As per the acknowledgement, the same was delivered.  Hearing Notice dated June 21, 2018 was sent to the said notice at the above-mentioned address through Speed Post, informing him of the personal hearing scheduled before WTM on July 24, 2018.

 Letter dated October 22, 2020 was sent to the Noticee providing him an opportunity to file written submissions in response to the SCN.

13. Noticee-wise summary of the replies/submissions received from the Noticees is provided hereunder. In the case of Noticees who have submitted similar replies, common issues have been identified and grouped together for the sake of brevity. In addition, once a common ground / contention is raised by one of the Noticees, it is not repeated for other Noticees. Accordingly, the replies of the Noticees are summarized below:

14. Mishka Finance and Trading Limited (Noticee No. 1 )

14.1. The Company has submitted its replies by way of letters dated May 19, 2018 and October 12, 2018.

14.2. By way of the said reply, it has been submitted by the Noticee that:

a. A common SCN was issued to 60 entities primarily in relation to trading done by certain entities in the scrip of the Company. No part of the SCN makes any allegation of any wrongful trading done by the Company or any of its Directors. b. The allegation against the Company and its six Directors that during the financial years 2012-13 and 2013-14, false and misleading objects of the preferential issue was presented to shareholders in notice of general meeting to the shareholders thereby violating the SEBI Act, 1992 and the PFUTP Regulations has been made on the basis of a bank statement. Also, the allegation against the Company for violation of the Act and the PFUTP Regulations, which predominantly deal with manipulative acts regarding trading, is not proper. c. The SCN extrapolates that the funds from preferential allotment were used for a certain purpose different from the notice and resolution. A copy of the said notice and resolution is annexed at Annexure 19 of the SCN. The SCN has missed out the mandatory explanatory statement as required under Reg. 73(1) of the ICDR Regulations 2009, which was annexed to the notice, for deciding the object of the preferential allotment.

The explanatory statement provided that the object of the issue was to meet the long term capital requirement of the Company. d. The main objects of the company as stated in the memorandum of association are as follows: 1 … 2. To carry on the business of financing in all its branches and in any moveable and immoveable goods and property of any description and to carry on business as mortgage brokers, financial agents and to do all sorts of financing and guaranteeing business. 3. To purchase, lease, exchange or otherwise acquire land, building and other immovable properties of any type or description and rights connected with land and turn the same into account in any manner what so ever and particularly by, preparing building sites, opening road and by constructing, altering, improving, decorating, furnishing and maintaining offices, flats, houses, shops, buildings etc. and by connecting, sub-dividing properties and by leasing or depositing off the same. 37 (b). To invest any moneys of the Company in such investments as may be thought proper and to hold, sell or otherwise deal with such investments. e. Considering the nature of the business of the Company, the funds of preferential allotment were used for the approved and declared purposes only and not otherwise. f. The proceeds of the preferential allotment were applied in the following manner: ▪ Payment to CD Equisearch Private Ltd (“CD Equisearch”) – Rs. 2,00,00,000; ▪ Payment to Esha Securities Limited (“Esha Securities”) – Rs. 2,21,21,221; ▪ Payment to Jitendra Dewoolkar (“Dewoolkar”) – Rs. 2,00,00,000. g. The payments made to CD Equisearch was for acquiring securities which is in consonance with the objects of the Company and a part of the working capital as suggested in the objects of the issue in the explanatory statement. h. The monies paid to CD Equisearch was used towards acquiring shares, which is a part of the working capital even as per the Accounting Standards issued by ICAI.

Further the Company has earned profits of more than Rs.

41 Lakhs in a span of 6 months from the said trades. Therefore, it cannot be alleged that the application of the proceeds of preferential allotment was in contravention of the objects of the issue. i. With regard to the payments made to Esha Securities Limited and Jitendra Dewoolkar, it has been submitted that the said amount was paid as advance for some business transaction which did not get through. Therefore the payment was received back from them. j. Further, the resolution for use of proceeds of Preferential Allotment was inclusive in nature and was an enabling resolution for the Company and its directors to utilize the proceeds to fulfill the additional fund requirements for capital expenditure including acquisition of companies/business, funding long term working capital requirements, marketing, setting up of offices abroad and for other approved corporate purposes. k. The word ‘including’ assumes great significance in the facts and circumstances of the present matter as the company and its directors always kept the option of utilization of funds open with them and made no representation whatsoever of the percentage of the proceeds of the issue being used for one specific item. In fact, the explanatory statement only lists 'To meet the long term working capital requirement of the Company" as the object of the issue, which has been fully met. Therefore, a combined reading of the resolution and explanatory statement to the said notice would signify that the utilization of the funds was in accordance with the objects of the issue. l. The ICDR Regulations specify that the disclosure has to be made in the explanatory statement to the notice and the objects of the issue were clearly stated to mean to meet the long term working capital requirement of the Company. m. The Company used the funds for the objects of the issue, and Form 26 AS for the financial years reflect that the funds were not just safe but TDS was also being deducted on the interest income from the money advanced by the Company, which is the working capital of the Company. n. No shareholder has ever complained against the Company for use of funds for purposes other than those disclosed. Also, no shareholder has ever complained against the Company of having committed any fraud or deceit.

14.2.2.Further, the trading in the shares of the Company has been suspended since April 17, 2015 by the BSE on account of the ex-parte ad-interim order. The suspension in the trading of the scrip has caused severe damage and hardship to the shareholders of the Company who have lost a valuable market for trading their securities.

15. Anikt Garodia, Director, Mishka (Noticee No. 2) and Jugal Kishore Pralhadrai Sharma, Director, Mishka ( Noticee No. 3)

15.1. Jugal Kishore Pralhadrai Sharma has submitted his replies by way of letters dated May 20, 2018 and November 05, 2020. Anikt Garodia has submitted his reply by way of letter dated May 20, 2018. The replies received from the above two Noticees are identical, and as such they have been clubbed together.

15.2. By way of the said replies, it has been submitted by the Noticees that:

a. The primary concern of SEBI is with regard to the transactions in the shares of the Company, and the Noticees have neither purchased nor sold any share of the Company as on May 20, 2018. b. The SCN fails to highlight any specific role of the Noticees, and the allegations are against the Company. c. The Noticees have perused the reply of the Company, and the said reply be treated as the reply of the Noticees.

16. Amit Kumar Vasishtha, Director, Mishka (Noticee No. 4 )

16.1. The Noticee has submitted his reply by way of letter dated February 07, 2018.

16.2. By way of the said reply, it has been submitted by the Noticee that:

a. The Noticee’s appointment happened six months after the preferential allotment and utilization thereof. b. The decision for preferential issue was taken on September 03, 2012, where the size of the offer and its purpose were decided. Preferential allotment was made by the Company on September 24, 2012. The receipt of proceeds for preferential allotment happened between September 18, 2012 and September 24, 2012. The utilization of the proceeds of preferential allotment was on September 25, 2012. c. A summary of the Noticee’s relationship with the Company is as under:

Date Particulars

March 30, 2013 Appointment as Additional Director in Board Meeting

March 03, 2015 Resignation from the post of a director d. The SCN does not make any specific averment or allegation against the Noticee in respect of the alleged violation by the Company of the SEBI Act and the PFUTP Regulations. In this this regard, reference has been made to Sharad Kumar Sanghi V. Sangita Rane, (2015) 12 SCC 781; S.M.S. Pharmaceuticals Ltd. V. Neeta Bhalla (2005) 8 SCC 89; Gorkha Security Services V. Govt. of NCT of Delhi (2014) 9 SCC 105. e. There was no basis for the issuance of the SCN as a director appointed after the events cannot be held responsible for the acts done prior to his appointment. In this regard reference has been made to SEBI Order dated March 31, 2015 in the matter of Kelvin Fincap Ltd.; SEBI Order dated February 16, 2006 in the matter of Home Trade Limited – WTM /GA/54/ISD/02/06 and State of Haryana V. Brij Lal Mittal.

17. Rameshwar Manohar Wagh, Director, Mishka (Noticee No. 5 )

17.1. The Noticee has submitted his reply by way of letter dated February 07, 2018.

17.2. By way of the said reply, it has been substantively submitted by the Noticee that:

a. The Noticee was appointed by the Company after all the alleged violations had already taken place and was in no way connected with the Company at the relevant point of time when the alleged violations took place. b. Summary of the decisions taken by the Company: Table-7

Date Particulars

September 03, 2012 The size of offer and its purpose were decided.

September 24, 2012 Preferential allotment made by the Company.

September 18, 2012 to Receipt of proceeds for preferential allotment. September 25, 2012

September 25, 2012 Utilization of proceeds of preferential allotment by the Company.

March 30, 2013 Appointment as Additional Director in Board Meeting.

Resignation from the post of a Director. March 03, 2015 c. The Noticee was never part of any of the meetings or decisions relating to preferential allotment or utilization thereof. d. The SCN is completely misconceived so far as it relates to the Noticee and none of the allegations in the SCN apply to the Noticee. e. It is established law that by merely being a director of a company, a person does not automatically become vicariously liable for all the violations that are allegedly committed by the company and a specific case has to be made out against the directors by showing as to how such director was responsible for the alleged violation or that the alleged violation took place with the consent of such director. In the absence of such specific allegations or evidence, a director of a company cannot be held vicariously liable for the acts of the company. The law with regard to the requirement of issuance of Show Cause Notice and the contents mandatorily required to be included in such show cause notice was recently considered and elaborated by the Hon'ble Supreme Court in Gorkha Security Services v. Govt. (NCT of Delhi), [(2014) 9 SCC 105]. f. The SCN is general and vague in nature and no specific case against the Noticee has been made out. g. The Noticee has not maintained any link / connection with the Company or its Promoters or any of its Directors in any capacity after resigning from the board of the Company.

18. Anand Gupta, Director, Mishka (Noticee No. 6 )

18.1. The Noticee has submitted his reply by way of letter dated May 18, 2018.

18.2. By way of the said reply, it has been inter alia submitted by the Noticee that:

a. He was never directly or indirectly involved in any sale and purchase of the equity shares of Mishka at any point of time during the period of SEBI examination, or after that period and did not hold any share of the Company at any point of time. He was holding the position of Director without any shareholding in the Company. b. The outgoing promoters/shareholders/directors only followed the instructions/directions of the broker/mediator, namely RRSPL for the transfer of shares in the name of new Promoters / Directors / Transferees as nominated by them. c. He was never responsible for any corporate action after the date of appointment of representatives of the new management. He never attended any Board or general meeting after the appointment of the representatives of the new management, namely Ankit Ompraksh Garodia and Jugal Kishore Sharma i.e., February 21, 2012. He was requested by the new management to be on the Board till the time more directors could be inducted, and resigned with effect from March 30, 2013.

18.3. The Noticee has provided an affidavit claiming that he was never part of any corporate action taken by the ‘new management’.

19. Vijay Kumar Jain, Director, Mishka (Noticee No. 7 )

19.1. The Noticee has submitted his reply by way of letter dated May 18, 2018.

19.2. By way of the said reply, it has been inter alia submitted by the Noticee that:

a. As per the MOU dated November 24, 2011, signed between him and Subhash Maheshwari, he had desired to transfer the shares of the Company by selling the shares of the Company off-market. b. He personally held 68,000 equity shares and he sold the same through RRSPL, and as consideration for such sale he received the consideration by way of Cheques bearing nos. 886252 and 886288 of IndusInd Bank for Rs. 2,50,000 and Rs. 90,000 respectively. c. He did not know any of the other transferors of the shares of Miska or the transferees. He was never directly or indirectly involved in the dealing in the shares of Mishka. d. He was never responsible for any corporate action after the date of appointment of representatives of the new management. He never attended any Board or general meeting after the appointment of the representatives of the new management, namely Ankit Ompraksh Garodia and Jugal Kishore Sharma i.e., February 21, 2012. He was requested by the new management to be on the Board till the time more directors could be inducted, and resigned with effect from March 30, 2013.

19.3. The Noticee has provided an affidavit claiming that he was never part of any corporate action taken by the ‘new management’.

19.4. An email dated October 28, 2020 has been received from Deepak Sharma, the Authorised Representative of Vijay Kumar Jain, informing the death of Vijay Kumar Jain along with a copy of the death certificate dated October 23, 2018 issued by the Municipal Corporation of South Delhi certifying his death on October 18, 2018 in Delhi.

20. Anil Satyanarayan Roongta (Noticee No. 8), Sudha Anil Roongta (Noticee No. 9), Anil Roongta HUF ( Noticee No. 12) (collectively referred to as the “Roongta entities”)

20.1. The Noticees have submitted a common reply to the subject SCN by way of letter dated July 23, 2018. Further, additional submissions, in the nature of clarifications to the questions posed during the personal hearing, have been submitted by the Noticees by way of letter dated September 14, 2018. Also, subsequent to the hearing on August 28, 2020, additional submissions dated September 17, 2020 have been received from the said Noticees.

20.2. The submissions made by the said Noticees can be divided into two parts. The first part relates to the allegations that RRSPL had devised a scheme to manipulate the price of the scrip by issuing an advertisement, buying shares from promoter entities and manipulating the price of the scrip through 53 entities, and as a company functions through its directors, Noticee Nos. 8 and 9, namely, Anil Satyanarayan Roongta and Sudha Roongta, directors of RRSPL were alleged to have violated provisions of Regulations 3(a)(b)(c)(d) and 4 (1) SEBI PFUTP Regulations, 2003. The second part relates to the allegation of price manipulation whereby the SCN has alleged that the 53 entities were not acting as genuine sellers, had no bona-fide intention to sell and were instrumental in establishing a price higher than the last traded price, contributing to increased scrip price with each of their trades, thereby creating a misleading appearance of trading and price rise in the scrip. It is further alleged that pursuant to price manipulation, out of the 53 entities, 50 entities i.e. Noticee Nos.8 to 57, sold the shares at inflated price and booked substantial profit. Accordingly, the SCN has alleged that the 53 entities i.e. Noticee Nos. 8 to 60 have violated Regulation 3(a),(b),(c),(d) and Regulation 4(1), 4(2) (a) & 4(2) (e) of SEBI (PFUTP) Regulations, 2003.

20.3. A summary of the submissions made by Noticee Nos. 8, 9, and 12 with respect to the first part of the allegations is as under :

a. RRSPL was approached by one Subhash Maheswari who informed that he had buyers, who were willing to purchase the shares of Mishka. The entire transaction was sourced and concluded by Subhash Maheshwari and RRSPL acted as a broker to the transactions between the said buyers and the sellers. b. Annexure-9 of the subject SCN (Replies from the entities who received shares in off-market from Promoters/Director) contains the replies of only 38 entities, out of which 9 entities do not claim to have purchased shares on the basis of any newspaper advertisement. c. Certain purchasers namely, Neha Narayan Toshniwal (date of purchase: 30/04/2012), Parul Rupesh Poddar (date of purchase: 30/04/2012), Rupesh Poddar (date of purchase: 30/04/2012) and Kiran Narayan Prasad Toshniwal (date of purchase: 15/06/2012) have claimed that they purchased shares based on the newspaper advertisement, even though the newspaper advertisement was allegedly issued on September 17, 2012.

d. 17 entities have the same reply and relied upon the exact same photocopy of the newspaper. The very same double inverted commas, (“ ”) on the advertisement made with a pen in all cases and description of the document in handwritten note are found on replies of most of such entities. Also, the said entities live in different cities and at times in different states, and at several such places the Economic Times Mumbai Edition is not even circulated. e. Annexure-8 of the SCN (replies of promoters and promoter related entities) enclosed a Memorandum of Understanding executed on stamp paper between Vijay Kumar Jain and Subhash Maheshwari dated November 24, 2011, wherein Subhash Maheshwari was mandated to sell shares of Mishka. This supports the contention of the present Noticees. f. BSE Regulation 14.2.1 introduced the concept of “Contract Note Cum Bill” on October 24, 2002 which reads, “Members shall, while issuing contract notes in accordance with regulation 14.2 to their constituents when acting for them as agents and when dealing with them as principals, be entitled to and may add such relevant details as they so deem fit to make it a contract note cum bill.

Provided, however, that the content of the contract note as so prescribed by the Governing Board from time to time shall not be diluted”. So, the allegation in the SCN that the requirement to issue “Contract Note Cum Bill” was introduced in November 2013 and prior to that the contracts issued were titled only as “Contract Note”, meaning that RRSPL issued fake contract notes is not correct. g. SEBI had requested RRSPL to provide copies of Contract Notes. RRSPL printed such contract notes from its back office and provided the same to SEBI. The SCN expresses reservation that RRSPL provided printed contract notes and not acknowledged contract notes. The copies provided by 12 entities, which were on pre-printed stationery, are bound to be different in form, font and style from the copies provided to SEBI, though, the relevant portion i.e. the content mandated by SEBI is same across both contract notes. Acknowledgements are required to be maintained for confirming whether the broker has delivered the contract notes to the clients or not. In the current case there is no dispute to that effect. h. There are only 2 possible formats (BSE/NSE) for issuing contract notes to clients.

In this case the stationery of BSE was used. It appears that the regulation / byelaws of NSE were inadvertently quoted in small font on top of the contract note and the footnotes. However they do not change the nature of the transactions. i. A perusal of the RTA records would clearly show that the shares were transferred directly from the sellers to the buyers and therefore the allegation that RRSPL acted as a principal is incorrect. Also, the rates specified in the Contract Notes were as directed by Subhash Maheshwari, who instructed the issuance of contract notes at all-inclusive rates, for which separate brokerage was not reflected in the contract note. As evident from the Agreement between the sellers and Mr. Subhash Maheshwari, the total consideration for the transaction would have been 24.90 Lakhs and the brokerage thereon at this rate would have been a negligible amount of Rs. 2490/- one side. As this amount was not material, request was made by a senior citizen viz. Mr. Subhash Maheshwari and as the present Noticees were also getting to invest in the shares of Mishka, RRSPL issued contract notes without brokerage. j. The construction of the back office software is such that for generating contract notes certain fields are mandatory and therefore the back office clerks generating the contract notes entered some order id, trade id and time to generate the contract note.

It is pertinent to note that all the buyers were well aware that the said trades were off market trades and therefore they directly received shares from sellers. k. In the present case, the contract notes issued were supported by genuine transactions and transfer of shares. So, the allegation that RRSPL issued fake contract notes is devoid of any merit. l. The SCN alleges that the contract notes were issued to help people give legitimate colour to the trading in the shares of Mishka, which were executed for possible tax benefits. The said allegation is misconceived as SEBI has already exonerated most of the 452 entities who purchased the shares. m. RRSPL never issued any such advertisement and the advertisement does not purport to state the name Mishka. Information was sought from the newspaper for the details of the advertiser; in response to which the newspaper company informed that details cannot be provided unless the same is pursuant to a police complaint. Accordingly, a complaint has been lodged with the police for investigation in the matter. Further, despite the name of Bhadresh Shah appearing in the advertisement, it has been sworn by him in an affidavit that neither did he place the advertisement nor did he receive any call from the entities for the shares of Mishka. n. SEBI has failed to provide any single rule, byelaw, regulation that supports its contention that a broker is not allowed to act as agents in scrips like Mishka, i.e. scrips which have been suspended for reasons like failure to file documents with the exchange, non-payment of listing fee etc. o. It is settled law that an allegation of conspiracy cannot be upheld against one party of the conspiracy while all others are being let off.

This is pertinent in the recent judgments of the Hon’ble SAT in the cases of KII Ltd. and Pat Financial Services. In the facts and circumstances of the present case, while the actual parties who have traded in the shares (promoters and 383 transferee entities) are not charged, but the director of the broking company has been.

20.4. A summary of the submissions made by the above-mentioned Noticees with respect to the second part of the allegations is as under :

a. The investment in shares of Mishka was made through banking channel and they never entered into any conspiracy to manipulate the price of the scrip. b. The shares of Mishka were purchased in an arm’s length transaction and the consideration was paid through the bank account. Similar purchases were made by 383 entities and most of the entities have not been asked to show cause for the purchase. Further, the entities that were given shares in preferential allotment have been completely exonerated. Therefore, no fault can be found with the purchase transactions.

c. It is also the case in the SCN that during Patch 1 the price of the scrip went up from Rs. 5.50 to Rs. 327.50, registering a price rise of Rs. 321.75. Based upon the SCN, it can be inferred that the net contribution of Noticee Nos. 8, 9 and 12 to increase in the LTP was Rs. 3.47 out of the total increase of Rs. 321.75, i.e. ~1.08% of the total increase during Patch I. d. The buy orders were already placed on the exchange and the present Noticees just sold the shares at a price at which the buyers were ready to purchase the shares. SEBI has not found any fault with the buyers or their prices, which goes on to suggest that both buyers and their order prices were genuine in the eyes of SEBI. That being so, selling shares to genuine buyers at prices which they intend to buy cannot be said to be manipulative. e. It is settled law that merely placing an order at a price different from the LTP cannot amount to a market manipulation. This is especially in case when the order price is higher than the LTP in case of a seller. It is a cardinal principle of the market that a seller wishes to sell his shares at the highest prices and the buyer wishes to purchase at the lowest prices possible. On the basis of the demand and supply of shares, the prices of the shares move upwards or downwards and the last traded price of a scrip changes several times in a day. f. In any event, in the facts and circumstances of the case, the buyers trading in the scrip had already placed buy orders on the upper circuit limit and since the scrip had hit the upper circuit, the present Notices could not have been able to sell shares at a lower price even if they were desirous of placing the order at a lower price.

g. Selling shares in smaller quantities is a regular trading strategy employed by several persons trading in the securities market. This can be done for various reasons like checking the connection status to the exchange systems, verifying the broadcast speed, identifying the market depth, identifying the movement in demand and supply, technical study of the price movement of the scrip, resistance level etc. No fault can be attributed for selling a smaller quantity of shares. During patch 1, on the dates shares of Mishka were sold the present Noticees or RRSPL had dealt in small quantity of shares in the following scrips: Table-8

Security Date Sell. Order No. T No. Qty Rate AXIS BANK LIMITED 23-May-13 N-098 2300892755 38138 -1 1489.8 AXIS BANK LIMITED 23-May-13 N-098 2300897211 38233 1 1489.7 HDFC BANK LIMITED 23-May-13 N-098 2300661123 26534 -1 701.25 FMFC BANK LIMITED 23-May-13 N-098 2300664635 26728 1 700.9 HDFC BANK LIMITED 23-May-13 N-098 2301188958 53060 -1 704 HDFC BANK LIMITED 23-May-13 N-098 2301191924 54138 1 704 HDFC BANK LIMITED 23-May-13 N-098 2301372777 62555 1 702.9 HDFC BANK LIMITED 23-May-13 N-098 2301375860 62773 -1 702.85 TATA POWER CO. LIMITED 19-Jul-13 N-139 1969508815 67969 1 91.2 TATA POWER CO. LIMITED 19-Jul-13 N-139 1970002190 68228 -1 92.35 RIGA SUGAR. CO. LTD. 25-Jun-13 N-062 148111638 1003 3 13.94 h. The Hon'ble Securities Appellate Tribunal in the case of Vikas Bengani (supra) also held that "It is, thus clear, that in order to establish the charge of price manipulation collusion between the buyer and the seller is necessary. In the case before us it has not been alleged that the appellant was colluding with the counterparty (seller) or with his broker. In the absence of such an allegation it cannot be held that the appellant was manipulating the price of the scrip of the company upwards.” i. The allegation that the present Noticees contributed to the LTP positively is incorrect. A seller cannot contribute to the LTP positively. It is the corresponding buyer, who buys the shares, that contributes to positive LTP. j. The SCN alleges that after allegedly contributing to the positive LTP, the present Noticees sold the shares and made substantial profit. However, multiple buyers who purchased either from the market, through RRSPL or were allotted shares under preferential allotment also sold shares at higher prices and they have not been asked to show cause. Therefore, it is not the case in the SCN that selling shares at higher prices amounts to market manipulation. k. The present Noticees are in no manner connected or related either by blood or otherwise to any other of the 50 entities (53 - Anil Roongta, A K Roongta HUF, Sudha Roongta). Further, all the said 50 parties have executed the transactions through their respective brokers and not through RRSPL.

21. Pawan Darak (Noticee No. 10)

21.1. The Noticee by way of letter dated February 06, 2018 and email dated September 05, 2020 has submitted his reply.

21.2. It has been inter alia submitted by the Noticee that a. 100 shares of the Company were acquired by the Noticee from RRSPL at a price of Rs. 30 per share. Subsequently, the Noticee sold a total of 8 shares in two trades on September 13, 2013 and September 17, 2013 respectively. b. The two trades, regarding which the SCN has alleged that they contributed 0.37 % to the total positive LTP, was executed without any intent to manipulate the price of the scrip. Also, the Noticee’s contribution of 0.37% to the total positive LTP was very negligible. c. After executing the two trades, the Noticee saw the price of the scrip rise. So, the Noticee decided to sell few of his holding at a higher price. Further, there is no bar on selling shares in small quantities. d. The counter party to the Noticee’s sale trades on September 13, 2013 and September 17, 2013, Shyam Kanheyalal Vyas has not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers who had already placed orders at upper circuit price. The Noticee has also stated that since, no allegation has been made against him for colluding with the buyer, the charge of manipulation should be dropped. e. Further, it has been submitted by the Noticee that the SCN does not allege any connection between the Noticee with any director/promoter of the company.

f. The Noticee has submitted that selling shares in small quantities was neither illegal nor violative of Regulations 3 and 4 of the PFUTP Regulations.

21.3. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003; Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008); and M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

22. Megha Ravi Wattamwar (Noticee No. 11)

22.1. The Noticee by way of letter dated January 02, 2018 and May 17, 2018 has submitted her reply. The Noticee by way of the said replies has stated that she denies all allegations made against her in the SCN. It has been also stated by the Noticee that she is a bonafide investor and dealt in the scrip of Mishka in the normal course of her business activity, and the same was in compliance with the relevant provisions of securities law. Further, it has been stated by the Noticee that trades in the scrip of Mishka were dealt in a fair and transparent manner, and the transactions were executed through the normal screen based trading system of stock exchange. In the screen based trading system, the automated system itself matches orders in a price-time priority and thus it is not possible for anybody to access the details of the identity of the counter party.

22.2. One Mr. Vikrant had arranged for the transfer of shares in off-market transactions from RRSPL. Also, during the relevant time i.e., on October 23, 2012 her father-in-law (Shri Bhaskar Wattamwar) had died, and all the family members were depressed and busy in performing religious rituals; so all formalities for the purchase of shares from RRSPL were carried out by Mr. Vikrant.

22.3. The Noticee has further stated that out of a total of 39,970 shares sold, only 3 shares have been alleged to have violated the PFUTP Regulations. The sell quantity alleged to have violated the PFUTP Regulations was negligible and cannot be said to have contributed to any price manipulation.

23. Vijay Kumar Soni HUF (Noticee No. 13)

23.1. The Noticee by way of letters dated January 05, 2018 and November 03, 2020 has submitted its reply. The Noticee has submitted that he purchased the shares of Mishka as a normal investor and the transactions with respect to the said shares were made through Karvy Stock Broking Ltd. Further, the Noticee has submitted that it was not connected, either directly or indirectly with the Company.

23.2. Further, the Noticee has submitted that allegation against him cannot be sustained in the absence of any collusion with the buyer or the promoter/director of the Company.

24. Ritu S Saraf (Noticee No. 14)

24.1. The Noticee by way of letter dated February 12, 2018 has submitted her reply.

24.2. It has been inter alia submitted by the Noticee that, a. 500 shares of the Company were acquired by the Noticee from RRSPL at a price of Rs. 30 per share. Subsequently, the Noticee sold a total of 4 shares in three trades on July 04, 2013; July 11, 2013; and July 17, 2013 respectively. b. The three trades, regarding which the SCN has alleged that they contributed 0.56 % to the total positive LTP, was executed without any intent to manipulate the price of the scrip. Also, the Noticee’s contribution of 0.56% to the total positive LTP was very negligible. c. After executing the two trades, the Noticee saw the price of the scrip rise. So, the Noticee decided to sell few of his holding at a higher price. Further, there is no bar on selling shares in small quantities and the same was neither illegal nor violative of Regulations 3 and 4 of the PFUTP Regulations. d. The counter party to the Noticee’s sale trades on July 04, 2013; July 11, 2013; and July 17, 2013, Shyam Kanheyalal Vyas has not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers, who had already placed orders at upper circuit price.

e. Further, it has been submitted by the Noticee that the SCN does not allege any connection between the Noticee with any director/promoter of the company.

24.3. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003; Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008); and M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

25. Kanta B. Jaju (Noticee No. 15)

25.1. The Noticee by way of letters dated August 21, 2017 and January 03, 2018, and email dated September 05, 2020 has submitted her reply.

25.2. The Noticee has inter alia submitted that – a. In the month of September 2012, she came across the classified advertisement published in Economic Times. She called RRSPL to show interest in dealing in shares. b. As per recommendation of RRSPL, 500 shares of Mishka were bought and payment of Rs.15,000/- for the same was made vide cheque no. 000103 dated November 19, 2012 drawn on the Karur Vysya Bank Ltd, Borivali Branch. A receipt for the same was also received from RRSPL.

c. In the month of May and June 2013, 2 shares of Mishka were sold to check the trading of the Company’s scrip in the market. Thereafter, the Noticee was advised by the Tax Consultant to sell the share after November 13, 2013 to get benefit of Long Term Capital Gain benefit and as such the shares were sold. d. The Noticee has also stated that since, no allegation has been made against her for colluding with the buyer, the charge of manipulation should be dropped. e. Further, it has been submitted by the Noticee that the SCN does not allege any connection between the Noticee with any director/promoter of the company. f. The Noticee has submitted that selling shares in small quantities was neither illegal nor violative of Regulations 3 and 4 of the PFUTP Regulations.

25.3. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003; Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008); and M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

26. Ravi Wattamwar HUF (Noticee No. 16)

26.1. The Noticee by way of letters dated January 02, 2018, May 17, 2018 and November 10, 2020 has submitted its reply.

26.2. The Noticee has submitted that he was a bonafide investor and had dealt in the scrip of the Company in the normal course of business activity and the same was very much within his financial and risk bearing capacity.

26.3. One Mr. Vikrant had arranged for the transfer of shares in off-market transactions from RRSPL. Also, during the relevant time i.e., on October 23, 2012 his father (Shri Bhaskar Wattamwar) had died, and all the family members were depressed and busy in performing religious rituals; so all formalities for the purchase of shares from RRSPL was carried out by Mr. Vikrant.

26.4. There was no intention or purpose to contribute to positive LTP while dealing in the scrip of Mishka.

26.5. The Noticee has further stated that out of a total of 39,970 shares sold by the Noticee, only 3 shares have been alleged to have violated the PFUTP Regulations. The sell quantity alleged to have violated the PFUTP Regulations was negligible and cannot be said to have contributed to any price manipulation.

27. Sunita Toshniwal (Noticee No. 18)

27.1. The Noticee by way of letter dated February 06, 2018 and email dated September 05, 2020 has submitted her reply.

27.2. It has been inter alia submitted by the Noticee that a. 100 shares of the Company were acquired by the Noticee from RRSPL at a price of Rs. 30 per share. b. Only one trade for three shares sold by the Noticee in the scrip of Mishka during Patch-1 has been alleged to have resulted in higher LTP. The single trade made on September 11, 2013, regarding which the SCN has alleged that it contributed 0.36 % to the total positive LTP, was executed without any intent to manipulate the price of the scrip. Also, the Noticee’s contribution of 0.36% to the total positive LTP was very negligible. c. Only single trades in Patch 1 have been considered by SEBI to be manipulative. The Noticee sold 970 shares in the scrip of Mishka subsequent to Patch -1 period and admittedly there was no impact on the LTP because of those trades. SEBI not finding fault with the large trading, cannot allege the trades executed during Patch-1 to be fraudulent. d. The counter party to the Noticee’s sale trades on September 11, 2013, Shyam Kanheyalal Vyas has not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers, who had already placed orders at upper circuit price. The Noticee has also stated that since, no allegation has been made against her for colluding with the buyer, the charge of manipulation should be dropped.

e. Further, it has been submitted by the Noticee that the SCN does not allege any connection between the Noticee with any director/promoter of the company. f. The Noticee has submitted that selling shares in small quantities was neither illegal nor violative of Regulations 3 and 4 of the PFUTP Regulations.

27.3. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003; Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008); and M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

28. Sanjay Ambadas Joshi (Noticee No. 19)

28.1. The Noticee by way of letters dated January 09, 2018, September 21, 2018, August 14, 2019 and November 11, 2020 has submitted its reply. The Noticee by way of the said replies has stated that he denies all allegations made against him in the SCN. It has been also stated by the Noticee that he is a bonafide investor and dealt in the scrip of Mishka in the normal course of his business activity, and the same was in compliance with the relevant provisions of securities law. Further, it has been stated by the Noticee that trades in the scrip of Mishka were done in a fair and transparent manner, and the transactions were executed through the normal screen based trading system of stock exchange. In the screen based trading system, the automated system itself matches orders in a price-time priority and thus it is not possible for anybody to access the details of the identity of the counter party.

28.2. The Noticee has further stated that out of a total of 79,950 shares sold by him, only 5 shares have been alleged to have violated the PFUTP Regulations. The sell quantity alleged to have violated the PFUTP Regulations was negligible and cannot be said to have contributed to any price manipulation.

29. Vinita Sanjay Joshi (Noticee No. 20)

29.1. The Noticee by way of letters dated January 09, 2018, September 21, 2018, August 14, 2019 and November 11, 2020 has submitted its reply. The Noticee by way of the said replies has stated that she denies all allegations made against her in the SCN. It has been also stated by the Noticee that she is a bonafide investor and dealt in the scrip of Mishka in the normal course of her business activity, and the same was in compliance with the relevant provisions of securities law. Further, it has been stated by the Noticee that trades in the scrip of Mishka were done in a fair and transparent manner, and the transactions were executed through the normal screen based trading system of stock exchange. In the screen based trading system, the automated system itself matches orders in a price-time priority and thus it is not possible for anybody to access the details of the identity of the counter party.

29.2. The Noticee has further stated that out of a total of 79,950 shares sold by her, only 5 shares have been alleged to have violated the PFUTP Regulations. The sell quantity alleged to have violated the PFUTP Regulations was negligible and cannot be said to have contributed to any price manipulation.

30. Kiran Narayanprasad Toshniwal (Noticee No. 21)

30.1. The Noticee by way of letter dated February 07, 2018 has submitted its reply.

30.2. It has been inter alia submitted by the Noticee that a. 600 shares of the Company were acquired by the Noticee from RRSPL at a price of Rs. 30 per share. b. Only one trade for four shares sold by the Noticee in the scrip of Mishka during Patch-1 has been alleged to have resulted in higher LTP. The single trade made on July 18, 2013, regarding which the SCN has alleged that it contributed 0.20 % to the total positive LTP, was executed without any intent to manipulate the price of the scrip. Also, the Noticee’s contribution of 0.20% to the total positive LTP was very negligible. c. Only single trades in Patch 1 have been considered by SEBI to be manipulative. The Noticee apart from the trade executed in Patch-1 had done substantial trading in the scrip of Mishka. SEBI not finding fault with the large trading, cannot allege the trades executed during Patch-1 to be fraudulent. d. The counter party to the Noticee’s sale trade on July 18, 2013, Chetan Rasiklal Shah has not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers, who had already placed orders at upper circuit price. e. It has been also stated by the Noticee that she is a bonafide investor and dealt in the scrip of Mishka in the normal course of his business activity. f. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated Febriary 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003.

31. Tejal Piyush Mehta (Noticee No. 22)

31.1. The Noticee by way of letter dated January 15, 2018 and email dated August 28, 2020 has submitted her reply.

31.2. The Noticce has also stated that, even though, no action has been taken against the buyer, action has been taken against her; and that collusion is required to be established to infer manipulation, which has not been found in this case.

31.3. Also, the Noticee has stated that there was no connection with promoters/directors of the Company.

31.4. The Noticee has submitted that selling shares in small quantities was not illegal. It has further been submitted by the Noticee that she used to sell the shares on daily basis in order to get maximum profit as the share price was getting higher every day.

31.5. Reference has been made by the Noticee to Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008) and Vikas Ganeshmal Bengani vs Whole Time Member, SEBI (Appeal No. 225 of 2009 decided on February 25, 2010). Further reference has also been made to M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

32. Sainik Kumar Jain/Shrenik Kumar Jain (Noticee No. 23)

32.1. The Noticee by way of letters dated February 13, 2018 and September 12, 2020 has submitted its reply.

32.2. The Noticee has informed that he bought 500 shares of Mishka from RRSPL. The Noticee has stated that the allegation of manipulation was with respect to the sale of 2 shares.

32.3. The Noticee has also stated that he never intended to sell the 2 shares, but to buy them. However, owing to an error the shares were sold. In that respect, the Noticee has informed that since the scrip of Mishka was hitting the upper price band on day to day basis, on April 9, 2013 he instructed his broker to purchase 2 shares. The Noticee was under the impression that the shares purchased earlier will come to the account; so on April 11, 2013 the broker was instructed to sell them back.

However, during the placement of order the Noticee was informed by the dealer that the shares were not bought but sold on April 9, 2013; so the Noticee immediately asked him to cancel the order.

32.4. Since, the price continued to rise, an order to purchase 2 shares on April 26, 2013 was placed to buy the shares that had earlier been sold. This order, as per the Noticee, did not go through. So, the dealer was asked to again try to place another order, which also did not go through.

32.5. The impact of the sale of the shares was 34 paise from the total price rise of Rs. 321 during February 14, 2013 to January 15, 2014.

32.6. The Noticee has stated that he is not connected to the counter party and therefore the charge of manipulation cannot be sustained.

32.7. The Noticee has stated that he was completely unaware of any manipulation and the same is proven from the fact that in order to make profit on the investment, he sold his entire shareholding on April 10, 2014 at and about Rs. 49, and not at the highest price of Rs. 55.

32.8. Reliance has been placed on the Orders passed by the Hon’ble SAT in Jayantilal Khandwala and Sons Pvt. Ltd. vs. SEBI (Appeal No. 63 of 2007 decided on ), Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 63 of 2007 decided on January 16, 2020)

33. Sorab Kumar Poddar (Noticee No. 27)

33.1. The Noticee by way of letter dated January 15, 2018 has submitted its reply.

33.2. It has been inter alia submitted by the Noticee that, a. 1500 shares of the Company were acquired by the Noticee from RRSPL at a price of Rs. 30 per share. Further to this, on or about February 2013, the Company issued bonus shares in the ratio of 7:1. So, the Noticee got a total of 10,500 shares for the 1500 shares held by him. b. One equity share of the Company was sold on June 11, 2013 through the broker, Mannubhai Mangaldas Securities private Limited to confirm the tradability of the scrip. c. The day to day price appreciation in the scrip of Mishka gave the Noticee confidence to hold on to the investment. This became fruitful as the Company declared a split of 1 share of face value Rs. 10 to 10 shares of Rs. 1. Consequent to the above, the Noticee got 1,19,990 shares on or about January, 2014. d. The Noticee looking at the upward movement of the price of shares continued to hold the shares. Finally, the Noticee sold 1,19,900 shares in the open market during the period June 2014 to July 2014 at the prevailing market price. e. The Noticee is not directly or indirectly related to the Company and has not been involved in any trading of securities in any fraudulent manner.

34. Rupesh Poddar (Noticee No. 28)

34.1. The Noticee has submitted his reply by way of undated letter received on July 17, 2018.

34.2. It has been inter alia submitted by the Noticee that a. The investigation report has been relied upon for issuing the Show Cause Notice, and the same was denied to him, which is a violation of natural justice. b. He came across with an advertisement in the Economic Times on 17th September, 2012. The said classified advertisement was issued by RRSPL and the contact details of one Mr. Bhadresh with telephone number was given there in the ad. Upon being informed that the business of the said Company was good and might give good returns in long run, he purchased 1000 shares at the rate of Rs. 6 per share.

c. As per the Show Cause Notice, the suspension of the scrip was from 7th January, 2002 to 9th May, 2012, and when he bought the shares on 25-10- 2012, the suspension had been lifted.

d. He is not connected to the Promoters either directly or indirectly, and the shares were bought from one Wave through RRSPL, an intermediary registered with SEBI, in an off-market transaction.

e. During 14th February, 2013 to 14th February, 2014, the price of the scrip rose from Rs.5.50 to Rs.327.25; whereas the Noticee sold two shares on 25th May, 2013 at Rs.16.65. Accordingly, the Noticee’s contribution to the increase in LTP is very minuscule.

f. He was not aware of the law relating to the issuance of the Contract notes. He ensured that he paid the consideration by way of cheque, and received a receipt/ bill/ contract note from the Broker. So, he cannot be held guilty if the Broker committed some irregularity.

g. The institution of proceedings against him .and few others, leaving the rest of the 383 entities that purchased shares, was inequitable and a violation of natural justice.

35. Hemraj Raneja (Noticee No. 31)

35.1. The Noticee by way of letter dated January 01, 2018 has submitted his reply.

35.2. The Notice has inter alia submitted that a. He purchased the shares physically through RRSPL on the basis of an advertisement in the newspaper. b. He is not related in any manner to the entities enlisted in the SCN or the promoters of those entities. c. The shares were bought for investment purposes, and decided to buy the shares of Mishka as the shares were available at a low price. d. It was expected that the share price will increase, so it was decided to hold the share for some time. Once, the share started to rise, the shares were sold.

35.3. The Noticee has further contended that there was no manipulation and it was a genuine purchase and sale of shares.

36. Sunayana Jain ( Noticee No. 33)

36.1. The Noticee by way of letter dated July 24, 2018 has submitted her reply.

36.2. The Noticee in her reply has inter alia submitted that a. She acquired 500 shares of Mishka from RRSPL at Rs. 30 per share. In Patch-1 period, she carried out 1 trade for 3 shares, which resulted in positive LTP of 0.20%. The 0.20% contribution to positive LTP is immaterial and she cannot be held responsible for manipulation.

b. The positive LTP of the scrip is determined by the ‘Buy side’ and the seller cannot by itself lead to positive LTP. Even though, no action has been taken against the buyer, action has been taken against her; and there was no connivance between the Noticee and the buyer.

c. She sold 34,500 shares and 5,470 shares on July 25, 2014 and August 22, 2014 at the prevailing prices. Further that as the legal and beneficial owner of the shares, she had the legal right to sell the shares at any quantities, whether small or large.

36.3. Reference has been made by the Noticee to the Orders of the Hon’ble SAT in Vikas Ganeshmal Bengani vs Whole Time Member, SEBI (Appeal No. 225 of 2009 decided on February 25, 2010), HB Stock Holdings Ltd. V SEBI ( Appeal No. 114 of 2012 decided on August 27, 2013), Adolf Pinto V. AO, SEBI (Appeal No. 102 of 2010 decided on September 0, 2010) and KSL & Industries Ltd. V Chairman, SEBI (Appeal No. 9 of 2003 decided on September 30, 2003).

37. Kiritkumar Ramniklal Mehta (Noticee No. 35)

37.1. The Noticee by way of email dated August 28, 2020 has submitted his reply.

37.2. The Noticee in his reply has stated that he is neither director/promoter nor connected to any member of the company. Also, that he had acquired 50 shares of Mishka from RRSPL at the price of 30 per share. It has been submitted by him that he had made 7 transactions in the scrip of Mishka during the period alleged to have resulted in higher LTP. His intention was only to gain profit, and there was no intention of any manipulation.

37.3. The Noticee has submitted that there was nothing that prevents an investor to sell shares in small quantities. It has further been submitted by the Noticee that he sold his shares in parts so as to earn maximum profit out of it.

37.4. The Noticee has submitted that the Noticee, who was the seller of shares cannot be held for manipulation, as the buyers had already placed orders at the upper circuit price of the scrip.

37.5. The Noticee has also stated that, even though, no action has been taken against the buyer, action has been taken against him; and there was no collusion between him and the buyer.

37.6. Further, the Noticee has stated that there were subsequent trades effected by him in the scrip of Mishka after the Patch 1 period, during which time the price was again rising; however, no manipulation has been alleged by SEBI for those trades. So, all the trades executed by him in the scrip of Mishka should be considered by SEBI while passing the order.

37.7. Reference has been made by the Noticee to the Orders of the Hon’ble SAT in Vikas Ganeshmal Bengani vs Whole Time Member, SEBI (Appeal No. 225 of 2009 decided on February 25, 2010), HB Stock Holdings Ltd. V SEBI ( Appeal No. 114 of 2012 decided on August 27, 2013), Adolf Pinto V. AO, SEBI (Appeal No. 102 of 2010 decided on September 0, 2010) and KSL & Industries Ltd. V Chairman, SEBI (Appeal No. 9 of 2003 decided on September 30, 2003).

38. Anand Raneja (Noticee No. 36)

38.1. The Noticee by way of letter dated January 01, 2018 has submitted his reply.

38.2. The Notice has inter alia submitted that a. He purchased the shares physically through RRSPL on the basis of an advertisement in the newspaper. b. He is not related in any manner to the entities enlisted in the SCN or the promoters of those entities. c. The shares were bought for investment purposes, and decided to buy the shares of Mishka as the shares were available at a low price. d. It was expected that the share price will increase, so it was decided to hold the share for some time. Once, the share started to rise, the shares were sold.

38.3. The Noticee has further contended that there was no manipulation and it was a genuine purchase and sale of shares.

39. Vikram Navinchandra Shah (Noticee No. 38)

39.1. The Noticee by way of letter dated January 02, 2018 has submitted its reply.

39.2. An acquisition of 50 shares was made in July 2013 through RRSPL. For the same, a cheque of Rs. 1500 bearing number 85593 issued from Bombay Mercantile Bank, Andheri (W) was given to RRSPL.

39.3. 35 shares out of the 50 i.e. 70% of the purchase was sold instantly. The remaining 15 shares were sold subsequently on BSE, which is shown in the SCN in table no 12 under serial no 47. By virtue of these purchases and sales, a profit of Rs. 7000 was made, on which applicable taxes have been paid.

39.4. The Noticee has no relation with Mishka and the Transferor in any way.

40. Parul Poddar (Noticee No.39)

40.1. The Noticee by way of letter dated January 11, 2018 has submitted its reply.

40.2. Opportunity of inspection of Documents was provided on March 27, 2018 and inspection of two files containing purportedly the originals of Annexures Nos. 9 and 11 was provided. The Investigation Report was not provided during the inspection.

40.3. Replies dated September 28, 2017 addressed to the Investigation Officer in reply to the summons dated August, 14 2017 were not considered for the purpose of preparation of the Investigation Report.

41. Ketan Mehta ( Noticee No. 40)

41.1. The Noticee by way of email dated August 28, 2020 has submitted his reply.

41.2. The Noticee in his reply has stated that he is neither director/promoter nor connected to any member of the company. Also, he had made 7 transactions in the scrip of Mishka, during the period alleged to have resulted in higher LTP. His intention was only to gain profit, and there was no intention of any manipulation.

41.3. The Noticee has also stated that, even though, no action has been taken against the buyer, action has been taken against him; and there was no collusion between him and the buyer.

41.4. Also, the Noticee has submitted that there was no finding that he had indulged in fraudulent or unfair trade practices in securities.

41.5. The Noticee has submitted that selling shares in small quantities was neither illegal nor was it banned by either the exchanges or SEBI. It has further been submitted by the Noticee that he sold small quantity of shares in spite of holding large quantity of shares, as the price of the share continuously increased after my sale, so he decided to sell small quantity of his holding at a higher price.

41.6. Reference has been made by the Noticee to Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008) and Vikas Ganeshmal Bengani vs Whole Time Member, SEBI (Appeal No. 225 of 2009 decided on February 25, 2010).

42. Usha Rakeshkumar Dixit (Noticee No.41)

42.1. The Noticee by way of letter dated January 06, 2018 has submitted its reply.

42.2. The shares were sold in a piecemeal manner as the Noticee was getting more profit on every transaction.

42.3. The Noticee has been receiving dividend from many well-known companies, which can be ascertained from the bank passbook.

43. Sandeep V. Saraf (Noticee No.42)

43.1. The Noticee by way of letter dated February 12, 2018 has submitted his reply.

43.2. It has been inter alia submitted by the Noticee that, a. 500 shares of the Company were acquired by him from RRSPL at a price of Rs. 30 per share. b. The SCN has alleged that 3 trades for four shares of Mishka sold by the Noticee on July 5, 2013, July 10, 2013 and July 15, 2013 during Patch-1 resulted in higher LTP. The trades made on July 5, 2013, July 10, 2013 and July 15, 2013 regarding which the SCN has alleged that it contributed 0.53 % to the total positive LTP, was executed without any intent to manipulate the price of the scrip. Also, the Noticee’s contribution of 0.53% to the total positive LTP was very negligible. c. Only the three trades in Patch 1 have been considered by SEBI to be manipulative. The Noticee apart from the trade executed in Patch-1 had done substantial trading in the scrip of Mishka. SEBI not finding fault with the large trading, cannot allege the trades executed during Patch-1 to be fraudulent. d. The counter party to the Noticee’s sale trades July 5, 2013, July 10, 2013 and July 15, 2013, Chetan Rasiklal Shah has not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers, who had already placed orders at upper circuit price. The Noticee has also stated that since, no allegation has been made against her for colluding with the buyer, the charge of manipulation should be dropped. e. Further, it has been submitted by the Noticee that the SCN does not allege any connection between the Noticee with any director/promoter of the company. f. The Noticee has submitted that selling shares in small quantities was neither illegal nor violative of Regulations 3 and 4 of the PFUTP Regulations. It has been also stated by the Noticee that he is a bonafide investor and dealt in the scrip of Mishka in the normal course of his business activity.

43.3. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003; Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008); and M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

44. Neha Narayan Toshniwal (Noticee No.43)

44.1. The Noticee by way of letter dated February 07, 2018 and email dated September 05, 2020 has submitted its reply.

44.2. It has been inter alia submitted by the Noticee that a. 1000 shares of the Company were acquired by the Noticee from RRSPL at a price of Rs. 6 per share. b. The SCN has alleged that one trade for 3 shares of Mishka sold by the Noticee on July 30, 2013 during Patch-1 resulted in higher LTP. The trade made on July 30, 2013 regarding which the SCN has alleged that it contributed 0.23 % to the total positive LTP, was executed without any intent to manipulate the price of the scrip. Also, the Noticee’s contribution of 0.23% to the total positive LTP was very negligible. c. Only the single trades in Patch 1 has been considered by SEBI to be manipulative. The Noticee apart from the trade executed in Patch-1 had done substantial trading in the scrip of Mishka. SEBI not finding fault with the large trading, cannot allege the trades executed during Patch-1 to be fraudulent. d. The counter party to the Noticee’s sale trade on July 30, 2013, Chetan Rasiklal Shah has not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers, who had already placed orders at upper circuit price. The Noticee has also stated that since, no allegation has been made against her for colluding with the buyer, the charge of manipulation should be dropped. e. Further, it has been submitted by the Noticee that the SCN does not allege any connection between the Noticee with any director/promoter of the company. f. The Noticee has submitted that selling shares in small quantities was neither illegal nor violative of Regulations 3 and 4 of the PFUTP Regulations.

44.3. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003; Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008); and M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

45. Manish Kumar Bhati (Noticee No.44)

45.1. The Noticee by way of letter dated January 29, 2018 has submitted its reply.

45.2. The Noticee held 1,500 equity shares in the Company. In February 2013 the Company issued bonus shares in the ratio of 7:1, and the Noticee got 10,500 equity shares of the Company of the face value Rs. 10.

45.3. Since, the shares of the Company were infrequently traded, on or about June, 2013, 1 share was sold by the Noticee in open market through the stock broker Manubhai Mangaldas Securities Private Limited to confirm the tradability.

45.4. The Company declared a split of its shares of Rs. 10 each to 10 shares of face value of Re. 1 on or about January, 2014 and the Noticee got 1,19,990 equity shares of face value Re. 1.

45.5. 1,19,990 equity shares of the Company were sold by in open market through the stock broker Satyanarayan M. Khetan during the period, June, 2014 to July, 2014 at the prevailing market price.

46. Savita Soni (Noticee No. 45)

46.1. The Noticee by way of email dated January 05, 2020 and letter dated November 03, 2020 has submitted her reply.

46.2. The Noticee has inter alia submitted that a. She purchased the shares of Mishka as a normal investor. b. The transaction of such shares was dealt with by Karvy Stock Broking Ltd. c. The Noticee is not connected directly or indirectly with Mishka.

46.3. Further, the Noticee has submitted that allegation against her cannot be sustained in the absence of any collusion with the buyer or the promoter/director of the Company.

47. Priyanka Mhapsekhar ( Noticee No. 46)

47.1. The Noticee by way of email dated August 28, 2020 has submitted her reply.

47.2. The Noticee in her reply has stated that she is neither director/promoter nor connected to any member of the company. Also, she had made 7 transactions in the scrip of Mishka during the period alleged to have resulted in higher LTP. Her intention was only to gain profit, and there was no intention of any manipulation.

47.3. The Noticce has also stated that, even though, no action has been taken against the buyer, action has been taken against him; and there was no collusion between him and the buyer.

47.4. Also, the Noticee has submitted that there was no finding that she had indulged in fraudulent or unfair trade practices in securities.

47.5. The Noticee has submitted that selling shares in small quantities was neither illegal nor was it banned by either the exchanges or SEBI. It has further been submitted by the Noticee that she sold small quantity of shares in spite of holding large quantity of shares, as the price of the share continuously increased after my sale, so she decided to sell small quantity of his holding at a higher price.

47.6. Reference has been made by the Noticee to Jagruti Securities Limtied vs Securities and Exchange Board of India (Appeal No. 102 of 2006 decided on October 27, 2008) and Vikas Ganeshmal Bengani vs Whole Time Member, SEBI (Appeal No. 225 of 2009 decided on February 25, 2010). Further reference has also been made to M/s Nishith M. Shah HUF V. Securities and Exchange Board of India (Appeal No. 97 of 2019 decided on 16.01.2020).

48. Tejas Gala ( Noticee No. 49)

48.1. The Noticee by way of email dated August 27, 2020 has submitted his reply.

48.2. The Noticee in his reply has stated that he is neither connected to any director/promoter of RRSPL or of the Company. Also, he had made 6 transactions in the scrip of Mishka during the period alleged to have resulted in higher LTP. His intention was only to gain profit, and there was no intention of any manipulation.

48.3. The Noticce has also stated that, even though, no action has been taken against the counterparties, action has been taken against him. Also, there was no collusion between him and the buyer.

48.4. Further, the Noticee has stated that there were subsequent trades effected by him in the scrip of Mishka after the Patch 1 period, during which time the price was again rising; however, no manipulation has been alleged by SEBI for those trades. So, all the trades executed by him in the scrip of Mishka should be considered by SEBI while passing the order.

48.5. It has further been submitted by the Noticee that he sold small quantity of shares in spite of holding large quantity of shares, as the price of the share continuously increased after my sale, so he decided to sell small quantity of his holding at a higher price.

48.6. Reference has been made by the Noticee to the order of the Hon’ble SAT in the matter of Vikas Ganshmal Bengani V. WTM, SEBI dated 25.02.2010.

49. Kavita Raneja ( Noticee No. 51)

49.1. The Noticee by way of letter dated January 01, 2018 has submitted her reply.

49.2. The Notice has inter alia submitted that a. She purchased the shares physically through RRSPL on the basis of an advertisement in the newspaper. b. She is not related in any manner to the entities enlisted in the SCN or the promoters of those entities. c. The shares were bought for investment purposes, and decided to buy the shares of Mishka as the shares were available at a low price. d. It was expected that the share price will increase, so it was decided to hold the share for some time. Once, the share started to rise, the shares were sold.

49.3. The Noticee has further contended that there was no manipulation and it was a genuine purchase and sale of shares.

50. Ashish Ishwarlal Shah (Noticee No. 52)

50.1. The Noticee by way of email dated August 28, 2020 has submitted his reply.

50.2. It has been submitted by the Noticee that he had purchased 50 shares of Mishka from RRSPL at the price of Rs. 30. Also, he had made 5 (sale) transactions in the scrip of Mishka during the period alleged to have resulted in higher LTP. His intention was only to gain profit, and there was no intention of any manipulation.

50.3. The Noticce has also stated that, even though, no action has been taken against the buyer, action has been taken against him; and there was no collusion between him and the buyer.

50.4. Also, the Noticee has submitted that there was no finding that he had indulged in fraudulent or unfair trade practices in securities.

50.5. The Noticee has submitted that selling shares in small quantities was neither illegal nor was it banned by either the exchanges or SEBI. It has further been submitted by the Noticee that he sold small quantity of shares in spite of holding large quantity of shares, as the price of the share continuously increased after my sale, so he decided to sell small quantity of his holding at a higher price.

50.6. The Noticee in his reply has stated that he is not connected to the director/promoter or any member of the company.

50.7. Reference has been made to Orders of the Hon’ble SAT in Vikas Ganshmal Bengani V. SEBI dated February 25, 2010; H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; and KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003.

51. Omprakash Sharma (Noticee No. 53)

51.1. The Noticee by way of letter dated March 06, 2018 and November 11, 2020 has submitted its reply.

51.2. It has been inter alia submitted by the Noticee that a. The SCN has alleged that 7 trades for 24 shares of Mishka sold by the Noticee between August 19, 2013 and January 01, 2014 during Patch-1 resulted in higher LTP. The abovementioned trades, regarding which the SCN has alleged that it contributed 5.33 % of the total positive LTP, was executed without any intent to manipulate the price of the scrip. b. The counter parties to the Noticee’s sale trades have not been issued an SCN for any violation or manipulation. There is no allegation of connivance between the Noticee and the counter parties. So, the Noticee cannot be alleged to have been involved in any price manipulation as the sale price of the shares was forced upon the Noticee by the buyers, who had already placed orders at upper circuit price for quantity ranging from 200 to 5000. c. The Noticee has also stated that since, no allegation has been made against him for colluding with the buyer, no charge of manipulation can be alleged against him. d. Nothing prevents an entity to sell shares in small quantities, since the lot size is 1.

51.3. Reference has been made to Orders of the Hon’ble SAT in H.B. Stock Holdings Ltd. V. SEBI dated August 27, 2013; Adolf Pinto V. AO SEBI dated September 07, 2010; and KSL and Industries ltd. V. Chairman, SEBI dated September 30, 2003

52. Manharlal N Shah (Noticee No. 59)

52.1. By way of email dated November 09, 2020, it has been informed by Kirit Shah, son of the Noticee that Manharlal N Shah has passed away. A copy of the death certificate received with the said email states that the Noticee died on April 13, 2016 in Mumbai.

53. Certain Noticees even after adequate opportunities have neither sent any reply nor appeared for personal hearing. The proceedings are at a stage now, where the passing of the order cannot be delayed / deferred any further. Thus, looking at the matter holistically as a group matter, I am considering passing of order with respect to all the Noticees, enumerated in the title of this order, irrespective of whether they have responded or not. I am taking into consideration the replies and submissions of Noticees who have responded, and the materials available on record with respect to other Noticees for passing this Order.

Relevant Violations :

54. Provisions of the SEBI Act

Section 12 A (a), (b), (c)

Prohibition of manipulative and deceptive devices, insider trading and substantial acquisition of securities or control.

“12A. No person shall directly or indirectly— (a)use or employ, in connection with the issue, purchase or sale of any securities listed or proposed to be listed on a recognized stock exchange, any manipulative or deceptive device or contrivance in contravention of the provisions of this Act or the rules or the regulations made thereunder;

(b) employ any device, scheme or artifice to defraud in connection with issue or dealing in securities which are listed or proposed to be listed on a recognised stock exchange;

(c) engage in any act, practice, course of business which operates or would operate as fraud or deceit upon any person, in connection with the issue, dealing in securities which are listed or proposed to be listed on a recognised stock exchange, in contravention of the provisions of this Act or the rules or the regulations made thereunder”

55. Provisions of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003

Regulation 3(a), (b), (c) and (d)

3. Prohibition of certain dealings in securities

No person shall directly or indirectly— (a) buy, sell or otherwise deal in securities in a fraudulent manner;

(b) use or employ, in connection with issue, purchase or sale of any security listed or proposed to be listed in a recognized stock exchange, any manipulative or deceptive device or contrivance in contravention of the provisions of the Act or the rules or the regulations made there under;

(c) employ any device, scheme or artifice to defraud in connection with dealing in or issue of securities which are listed or proposed to be listed on a recognized stock exchange;

(d) engage in any act, practice, course of business which operates or would operate as fraud or deceit upon any person in connection with any dealing in or issue of securities which are listed or proposed to be listed on a recognized stock exchange in contravention of the provisions of the Act or the rules and the regulations made there under.

Regulation 4 (1), 4(2)

4. Prohibition of manipulative, fraudulent and unfair trade practices (1)Without prejudice to the provisions of regulation 3, no person shall indulge in a manipulative, fraudulent or an unfair trade practice in securities markets.

(2)Dealing in securities shall be deemed to be a manipulative fraudulent or an unfair trade practice if it involves any of the following:— (a) indulging in an act which creates false or misleading appearance of trading in the securities market;

(b) … (e) any act or omission amounting to manipulation of the price of a security;

(f) publishing or causing to publish or reporting or causing to report by a person dealing in securities any information which is not true or which he does not believe to be true prior to or in the course of dealing in securities;

(k) an advertisement that is misleading or that contains information in a distorted manner and which may influe nce the decision of the investors;

(r) planting false or misleading news which may induce sale or purchase of securities.

Issues for consideration:-

I. Whether the company and its six directors (Noticees 1 to 7) utilized the proceeds of the preferential issue as per the objects of the preferential issue, disclosed to the shareholders in the Notice of General Meeting of the members of the company held on September 03, 2012?

II. Whether the directors of RRSPL ( Noticee Nos. 8 and 9) acted simply as agents or were they involved in devising a scheme of manipulating the price of the scrip by issuing an advertisement and buying shares from the promoter entities?

III. Whether the trades of 41 remaining Noticees (including Anil Satyanarayan Roongta, Sudha Anil Roongta and A.K. Roongta HUF), amounted to manipulation of the price of the scrip of Mishka in Patch-1 and Patch-2?

I. Whether the Company and its six directors (Noticees 1 to 7) during the financial years 2012-13 & 2013-14, utilized the proceeds of the preferential issue as per the objects of the preferential issue, disclosed to shareholders in the Notice of General Meeting of the members of the company held on September 03, 2012?

56. The SCN has alleged that the Company and Ankit Om Prakash Garodia, Jugalkishore Sharma, Amit Kumar Vasishtha, Rameshwar Manohar Wagh, Anand Gupta and Vijay Kumar Jain (Noticee Nos. 1 to 7) (who were the directors during the period 2012-13 and 2013-14), presented false and misleading objects of the preferential issue to the shareholders in the Notice of General Meeting of the Company thereby violating Section 12A (a), (b) and (c) of SEBI Act, 1992 and Regulations 3 (a), (b), (c), (d), 4(1), 4(2)(f),(k) and (r) of SEBI (PFUTP) Regulations, 2003. The preferential issue took place on September 24, 2012.

57. The details with respect to the preferential issuance of shares made by the Company are as under:

Table-9

Sl. No. Description Date/ Period a. The Company’s total shareholding Prior to September 24, comprised of 4,98,000 shares 2012 b. 7,93,700 shares issued on preferential basis September 24, 2012 to 46 entities at Rs.85 per share (Face value of Rs.10 per share at premium of Rs.75 per share)

c. The company received the preferential September 18, 2012 to allotment proceeds in its bank account September 25, 2012 bearing number 12920200000506 maintained with Bank of Baroda.

d. The shares issued by way of the above Till September 23, 2013 preferential allotment were under lock-in.

58. In this regard, from the copy of the notice and copy of resolution of General Meeting of the members of the Company held on September 03, 2012, wherein a special resolution was passed under section 81(1A) of the Companies Act, 1956, for the above-mentioned preferential allotment, it was observed by investigation that the objects of the preferential issue as presented to the shareholders, and filed with the MCA were the following:

• Capital expenditure including acquisition of company/business; • Funding long term working capital requirements; • Marketing • Setting up of offices abroad and;

• For other approved corporate purposes.

59. In this regard, the Balance Sheet and Profit & Loss Accounts of the Company for the FY 2012-13, 13-14 & 15-16 were analysed. The details of analysis as per the SCN are as follows:

FY 2012-13 ▪ The Company did not have any fixed assets during the FY 2012-13, and there was no addition to the fixed assets during the FY 2012-13. Further, “Short term loans and advances” of the Company increased to Rs.10,54,84,140 as on March 31, 2013 from Rs.34,56,975 as on March 31, 2012. On the other hand, “Non-current Investments” of the Company reduced to Rs.50,10,416 as on March 31, 2013 from Rs.4,51,84,166 as on March 31, 2012.

FY 2013-14 ▪ The Company did not have any fixed assets during the FY 2013-14 and there was no addition to fixed assets during the FY 2013-14. There were Nil “Long term loans and advances” of the Company as on March 31, 2013. However,as on March 31, 2014, the balance under this head was Rs.4,89,90,212. Further, the balance under the head “Short term loans and advances” of the Company as on March 31, 2014 was Rs.4,64,91,338. Therefore total “Loans and advances” of the company as on March 31, 2014 was Rs.9,54,81,550. On the other hand, “Non-current Investments” of the Company was reduced to Nil as on March 31, 2014 from Rs.50,10,416 as on March 31, 2013.

60. From the above analysis, it was observed that a) there were no additions to the fixed assets of the Company; b) there was no mention of any capital work-in-progress; c) the cash flow statements for these years did not show any cash flow relating to acquisition and development of moveable and immovable property (i.e. negative cash flow from investing activities); and d) on the contrary company sold its existing investments in the F.Y. 2012-13 and 2013-14.

61. It was observed that the Company had received the allotment proceeds in its bank account bearing number 12920200000506 maintained with the Bank of Baroda between September 18, 2012 and September 25, 2012. The analysis of the bank statements of the said bank account has revealed that Rs.6,74,64,500 received through preferential allotment of equity shares was immediately transferred to three entities namely CD Equisearch Pvt. Ltd (Rs.2,00,00,000), Esha Securities Limited (Rs.2,21,21,221) and Jitendra Dewoolkar (Rs.2,00,00,000) on September 25, 2012. It was also observed that prior to receipt of the proceeds of the preferential allotments, the funds available in the bank account of the Company would not have been sufficient enough for transfers to various entities. So, it was indeed the allotment proceeds that was transferred to the above entities.

62. Considering the same, the SCN has alleged that the objects of the issue as presented by the Company to its shareholders in the Notice of General Meeting of the members of the company held on September 03, 2012 and disclosed to MCA was not true, and the same was misleading and contained information in a distorted manner, which might have influence the decision of the investors. Considering the above, the SCN has alleged violation of provisions of the SEBI Act and the SEBI PFUTP Regulations as aforesaid.

63. In response to the said allegation, the Company has essentially submitted as shown below:

63.1. The SCN has placed sole reliance on the Notice of General meeting and Special resolution and has critically missed out the explanatory statement under Reg. 73(1) of the ICDR Regulations 2009, which states the object of the preferential allotment to be “To meet the long term working capital requirement of the Company”. So, the transactions carried out by the Company were in conformity with the disclosure.

63.2. The proceeds of preferential allotment were used for the approved and declared purposes only and not otherwise, in consonance with the objects of the Company as provided in the Memorandum of Association.

63.3. The special resolution for the use of the proceeds of preferential allotment was inclusive in nature and was an enabling resolution for the Company and its directors to utilise the proceeds to fulfil capital expenditure including acquisition of company/business, funding long term working capital requirements, marketing, setting up of offices abroad and, for other approved corporate purposes. And that the Company and its directors always kept the option of utilisation of funds open with them and made no representation whatsoever of the percentage of proceeds of the issue being used for one specific item.

63.4. The payments made to Esha Securities (Rs. 2,21,21,221 ) and Jitendra Dewoolkar (Rs. 2,00,00,000) were for some business transactions which did not go through. Therefore, the payment was received back from them.

63.5. The payment of a sum of Rs. 2,00,00,000 made to CD Equisearch for acquisition of securities, was a part of the working capital.

64. It would be relevant to reproduce the regulatory framework for a preferential allotment as it existed at the relevant time. Regulation 72 read, “Conditions for preferential issue.

72. (1) A listed issuer may make a preferential issue of specified securities, if:

(a) a special resolution has been passed by its shareholders;

(b) all the equity shares, if any, held by the proposed allottees in the issuer are in dematerialised form;

(c) the issuer is in compliance with the conditions for continuous listing of equity shares as specified in the listing agreement with the recognised stock exchange where the equity shares of the issuer are listed;

(d) the issuer has obtained the Permanent Account Number of the proposed allottees.

(2) The issuer shall not make preferential issue of specified securities to any person who has sold any equity shares of the issuer during the six months preceding the relevant date: Provided that in respect of the preferential issue of equity shares and compulsorily convertible debt instruments, whether fully or partly, the Board may grant relaxation from the requirements of this sub-regulation, if the Board has granted relaxation in terms of regulation 29A of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 to such preferential allotment.”

Regulation 73 (1) reads, “Disclosures

73. (1) The issuer shall, in addition to the disclosures required under section 173 of the Companies Act, 1956 or any other applicable law, disclose the following in the explanatory statement to the notice for the general meeting (emphasis supplied) proposed for passing special resolution:

(a) the objects of the preferential issue (emphasis supplied);

(b) the proposal of the promoters, directors or key management personnel of the issuer to subscribe to the offer;

(c) the shareholding pattern of the issuer before and after the preferential issue;

(d) the time within which the preferential issue shall be completed;

(e) the identity of the proposed allottees, the percentage of post preferential issue capital that may be held by them and change in control, if any, in the issuer consequent to the preferential issue;

(f) an undertaking that the issuer shall re-compute the price of the specified securities in terms of the provision of these regulations where it is required to do so;

(g) an undertaking that if the amount payable on account of the re-computation of price is not paid within the time stipulated in these regulations, the specified securities shall continue to be locked-in till the time such amount is paid by the allottees.”

65. It is observed from the special resolution of the shareholders for preferential allotment of shares and the filing of the Company with the MCA that the aforesaid fund raising through preferential allotment was for capital expenditure including acquisition of company/business, funding long term working capital requirements, marketing, setting up of offices abroad and, for other approved corporate purposes. The Company contended that in the explanatory statement under Regulation 73 of the SEBI ICDR Regulations, 2009, the object of the preferential allotment has been listed as “To meet the long term working capital requirement of the Company”, and accordingly, the transactions carried out by it were in conformity with the disclosure.

66. The Company has asserted that the funds of preferential allotment were used for the approved and declared purposes in consonance with the objects of the Company as provided in the Memorandum of Association. It is stated that the objects contained in the Memorandum of Association provide the general areas in which a company can operate in. On the other hand, a preferential allotment is a specific corporate action for issuance of shares that inter alia requires the Company to declare the objects for such preferential allotment. Therefore, the submission of the Company that the proceeds of the preferential allotment were used for the general objects of the Company as provided in the Memorandum of Association is sweeping and generic in nature. The company has failed to show how it has utilized the issue proceeds for the specific purpose for which the preferential issue was done by the Company. Further, it has been submitted by the Company that the special resolution for the use of the proceeds of preferential allotment was inclusive in nature and was an enabling resolution for the Company and its directors to utilise the proceeds for the objects enumerated in the Notice of General Meeting. And that the Company and its directors always kept the option of utilisation of funds open with them and made no representation whatsoever of the percentage of proceeds of the issue being used for one specific item.

67. In this context, it will be relevant to examine the use of the proceeds of the preferential allotment. A sum of Rs. 2,00,00,000 was transferred to CD Equisearch, which was,as per the Company, for acquisition of securities. The Company has claimed that the same was a part of the working capital as per the Accounting Standards issued by the Institute of Chartered Accountants of India. Similarly, payments of Rs. 2,21,21,221 and Rs. 2,00,00,000 respectively were made to Esha Securities and Jitendra Dewoolkar, which as per the Company were paid as an advance for a business transaction, which did not go through and the money was returned.

68. It is revealed from the submissions made by the Company that more than 70 % of the proceeds was given as advance for buying properties from Esha Securities and Jitendra Dewoolkar. From the documents submitted by Mishka, it is seen that an MoU dated

25 September, 2012 was signed between Esha Securities and Mishka. The said MoU states, “2. Principal (Mishka) with a view of expanding its trading business is looking out for procuring property in Delhi. 3. Agent (Esha Securities) is appointed to find out suitable property in Delhi as per the requirements of principal on ownership or otherwise. 3. Agent has agreed to look out for the property for Principal on terms and conditions as setout herein below.” Further to the signing of the said MoU, an advance of more than Rs. 2 crore, which is 33% of the proceeds, was given to Esha Securities. As per the submissions of the Company, it is revealed that the said MoU was cancelled only on April 01, 2013, and the total sum advanced was returned in tranches between April 01, 2013 and May 14, 2013. Thus, from the above, it is evident that the advance was made on the basis of an unstamped MoU and not binding agreements or contracts, and no interest was charged for the a period of over six months, before being returned by Esha Securities. It was observed from the said MoU that clause 2 of the operative covenants reads “Agent shall assist the Principal in finding out appropriate property in Mumbai.” At the same time, clause 5 of the operative covenants provides that “ In the event, if the Agent could not find the appropriate property in Delhi for the Principal upto 31st March 2013, the Agent shall repay the advance of Rs. 2,21,21,221 without interest to Principal.” This is ex-facie contradictory. Also, the said advance of Rs. 2,21,21,221 was made to Esha Securities even before the property to be acquired had been identified. Hence, I am of the view that the MoU was a mere white paper document, created as an afterthought to cover the transfer of funds mobilised using the securities market medium.

69. Similarly, another MoU dated September 22, 2012 was signed between Mishka and Jitendra Dewoolkar, whereby Jitendra Dewoolkar was supposed to sell and Mishka was to buy a Flat in Mumbai. Pursuant to the signing of the said MoU, an amount of Rs. 2,00,00,000 was advanced to Jitendra Dewoolkar. In this respect, the said MoU states, “1. That the Seller has agreed to sell and the Buyer has agreed to purchase “the said Flat” more particularly described in the Schedules annexed hereto, for a total consideration of Rs 6,00,00, 000 /- (Rupees Six Crore Only). 2. That a sum of Rs. 2,00,00,000 /- (Two Crore Only) shall be paid by the Buyer on the execution of this MoU, and balance amount Rs 4,00,00,000/- shall be paid by 31st October 2012 or before registration.” The said MoU further states, “ 8. The transaction shall be completed by 31st October, 2012. This clause shall form the essence of this MOU. (Emphasis in original text) 9. The Buyer and Seller may on mutual consent cancel the MOU before the completion of the stipulated period of Sale and on such cancellation of MOU, the Buyer’s right to the amount as paid by them towards the aforesaid consideration, will be returned by Seller, free of any interest and after deduction of any damages, charges etc. as mutually agreed.” As per the submissions of the Company, it is revealed that the said MoU was cancelled on October 25, 2012 and this happens to be just 5 days before the agreed date for completion of the sale. Pursuant to such cancellation, the sum of Rs. 2 crore was returned back to Mishka. In this case, I find that the total worth of the property was Rs.6 crore. So, a sum of Rs. 4 crore was to be additionally paid to Jitendra Dewoolkar by Mishka, and the said transaction was to be completed by October 31, 2012. This was impossible as Mishka had no financial wherewithal to finance such additional payment of Rs. 4 core, which is clear from the summary of the financial performance of the Company for the FYs 2011-12 to 2013-14:

Table-10 (₹ In Crore) Description Financial Year

2011-12 2012-13 2013-14

Net sales/Revenue 0.00 16.45 27.11

Other Income 0.00 0.22 0.42

Total income 0.00 16.67 27.53

Profit Before tax -0.12 0.18 0.58

Net Profit -0.12 0.12 0.42

70. Further except the execution of the MoU on unstamped papers, there was no “Agreement to Sell” or any other supporting documents for the transfer of a property worth 6 crore rupees. Furthermore, the Company has failed to make out a case as to how the purchase of a flat was connected with the objects of the preferential allotment. Thus, I find that the advances given to Esha Securities and Jitendra Dewoolkar were not intended to fructify into transactions, and were executed with the objective of creating an impression that the Company was trying to acquire immovable property, for business purposes. The sequence of execution of the MoUs and their cancellation thereof shows that the preferential issue was not bona fide and that it was done with the ulterior motives of utilizing the proceeds for purposes not declared.

71. The SCN states that the objects of the preferential allotment, as informed to the shareholders, by way of the Notice of General Meeting, and the special resolution passed pursuant thereto, are different from the object of the preferential allotment mentioned in the explanatory statement provided under Regulation 73 of SEBI ICDR Regulations, 2009. For the sake of examination, a comparison of is tabulated hereunder:

Objects of the Preferential issue as Object of the preferential allotment presented to shareholders/filed with mentioned in the explanatory MCA in Notice of General Meeting of statement provided under Regulation the members of the company held on 73 of SEBI ICDR Regulations, 2009 September 03, 2012

 Capital expenditure including  To meet the long term working acquisition of company/business; capital requirement of the Company  Funding long term working capital requirements;

 Marketing;

 Setting up of offices abroad and;

 For other approved corporate purposes.

72. As stated in the SCN, the Company utilized preferential issue proceeds majorly for extending loans & advances for acquiring residential premises. This was not disclosed as a specific object of the Issue u/r 73(1)(a) of ICDR Regulations. Rather, the object disclosed by the Company under the said regulation was “To meet the long term working capital requirement of the Company.”, which is too broad based and may include loans and advances done as part of the normal course of its business. I note that the objects disclosed by the Company in the Notice of General Meeting, as filed with the MCA, states one of the objects to be “For other approved corporate purposes”. This expression is also vague and broad. After having examined the utilization/ deployment of the funds of preferential allotment, as brought out in the foregoing paragraphs of the Order, I find that the broad and sweeping objects disclosed under Regulation 73(1)(a) of ICDR Regulations as well as in the expression “For other approved corporate purposes” as part of the Notice of General Meeting are consciously motivated. It appears that the only objective of the Company and its directors was to raise funds through the preferential issue route and utilize it as per the wishes of the directors/promoters.

73. In view of the above, I conclude that the Company did not present the true and correct objects of the preferential issue to the shareholders in the Notice of General Meeting. The disclosures have been consciously calibrated towards misleading the shareholders by keeping the objects of the preferential issue broad and vague. Since, the Company failed to present the true and correct objects of the preferential issue in the Notice of General Meeting of the Company, it is clear that the shareholder approval for the proposal cannot be construed as real concurrence for the said preferential allotment from the shareholders. In this context, it would be relevant to draw reference to the provisions alleged to have been violated, in the SCN: Section 12A (a), (b) and (c) of SEBI Act, 1992 and Regulations 3 (a), (b), (c), (d), 4(1), 4(2)(f), (k) and (r) of SEBI (PFUTP) Regulations, 2003. The above provisions prohibit the use of manipulative and deceptive devices in the securities market and acts that would operate as fraud or deceit upon any person, in connection with dealing in securities. Further, 4 (2) (f) provides that the publishing or reporting of any information which is not true or which a person does not believe to be true prior to or in the course of dealing in securities shall be deemed to be a manipulative fraudulent or an unfair trade practice.

Also, 4 (2) (k) provides that an advertisement that is misleading or that contains information in a distorted manner and which may influence the decision of the investors shall be deemed to be a manipulative fraudulent or an unfair trade practice. Further, 4 (2) (r) provides that the planting of false or misleading news which may induce sale or purchase of securities shall be deemed to be a manipulative fraudulent or an unfair trade practice. In this regard, the Company and its directors by their failure to present true and correct objects of the preferential issue to the shareholders in the Notice of General Meeting have employed a manipulative device to deceive the shareholders into giving their concurrence to the special resolution for the preferential allotment and would squarely fall within the ambit of Regulation 4(2) (f), (k) and (r ) of SEBI (PFUTP) Regulations. Therefore, I find that the Company has violated Section 12A (a), (b) and (c) of SEBI Act, 1992 and Regulations 3 (a), (b), (c), (d), 4(1), 4(2)(f)(k) and (r) of SEBI (PFUTP) Regulations, 2003.

Role of Directors

74. Furthermore, it is stated that a company works through its directors. Accordingly, in view of above finding in respect of the Company, the situation warrants an examination of the role of the directors of the Company.

75. The Investigation Period determined for the matter was February 14, 2013 to December 31, 2014. As per SCN, the Board of Directors during the investigation period consisted of:-

Table- 11

DIN PAN Director's Category Appointment Cessation Name of Date Date Director

ARRPG4567A Ankit Om Managing 21/02/2012 Continued 5172218 Prakash Director during the Garodia Investigation Period

ABLPS6840A Jugalkishore Whole 21/02/2012 Continued 5205981 Sharma time during the Director Investigation Period

AKNPV5025B Amit Kumar Director 30/03/2013 03/03/2015 5358607 Vasishtha

DIN PAN Director's Category Appointment Cessation Name of Date Date Director

ABLPW8901G Rameshwar Director 30/03/2013 03/03/2015 6413315 Manohar Wagh

Anand Gupta Director 02/09/2001 30/03/2013 649031 AFNPG7938K

Vijay Kumar Director 01/07/2007 30/03/2013 166175 AAAPJ3197K Jain

76. It is a matter of record that the Notice for the 28th Annual General Meeting was circulated on August 08, 2012, inter alia for approval for the issuance of shares on a preferential basis. Pursuant to the said Notice, a Special Resolution under Section 81(1A) of the Companies Act, 1956 was passed at the said Annual General Meeting held on September 03, 2012. The said Notice had been circulated by Ankit Om Prakash Garodia, Director. Further, it is observed that on the said date of issuance of Notice on August 08, 2012, the Directors in the Company were: Ankit Om Prakash Garodia, Jugalkishore Sharma, Anand Gupta and Vijay Kumar Jain. Further, the Special Resolution approving the issuance of shares on a preferential basis provided that “ the Board of Directors of the company be and are hereby authorised to determine the terms and conditions of the issue including face value, quantity, issue price (Including

Price range), manner of calls etc. in such manner as the Board may deem fit and proper in its absolute discretion to be most beneficial to the Company and to approach SEBI and/ or any other competent authority to do all such acts, deeds, matters and things as may be necessary, appropriate and proper or expedient for giving effect to the above Resolution.” Thus, it is clear that the Board of Directors comprising of the above directors was entrusted with the responsibility of doing all acts for giving effect to the said resolution. It must be stated that consequent to the passing of the said resolution, the proceeds of the preferential allotment were transferred to three entities, which was, as already established, in contravention of the declared objects of the said preferential allotment.

77. The directors, Amit Kumar Vasishtha (Noticee No. 4) and Rameshwar Manohar Wagh (Noticee No. 5) have claimed that they were never part of any of the meetings or decisions relating to preferential allotment or utilisation thereof. Similarly, Anand Gupta (Noticee No. 6) and Vijay Kumar Jain (Noticee No. 7) have stated that they were never responsible for any corporate action after the date of appointment of representatives of the ‘new management’, i.e., February 21, 2012. The new management representatives, according to Noticee Nos. 6 and 7 are Ankit Ompraksh Garodia and Jugal Kishore Sharma. It is their case that they never attended any Board meeting or general meeting of the shareholders subsequent to the appointment of Ankit Ompraksh Garodia and Jugal Kishore Sharma. Further, Anand Gupta and Vijay Kumar Jain have submitted affidavits to claim that they were never part of any corporate action taken by the ‘new management’.

78. In this regard, the tenures of directorship of the aforesaid four directors namely— Amit Kumar Vasishtha, Rameshwar Manohar Wagh, Anand Gupta and Vijay Kumar Jain are relevant. The details, as provided in Table – 11 above, reveal that both Amit Kumar Vasishtha and Rameshwar Manohar Wagh joined the Board of the Company on March 30, 2013 and ceased to be members of the Board on March 03, 2015. Anand Gupta joined as a Director of the Company on September 02, 2001 and continued to be a Director of the Company till March 30, 2013. Similarly, Vijay Kumar Jain joined as a Director of the Company on July 01, 2007 and continued to be a Director of the Company till March 30, 2013. Further, it would also be relevant to examine the sequence of events in respect of the preferential allotment. From the material on record, it is seen that on September 03, 2012 the Company took the decision determining the size of the preferential allotment and its purpose; on September 24, 2012, the preferential allotment was made by the Company; from September 18, 2012 to September 25, 2012 the Company received the proceeds of the preferential allotment; and on September 25, 2012 transfers were made utilizing the proceeds of preferential allotment by the Company.

79. From a perusal of the above, it appears that the decisions regarding the size of the offer and its purpose, preferential allotment and utilisation of the proceeds happened prior to the joining of Amit Kumar Vasishtha and Rameshwar Manohar Wagh. So, the decisions regarding the preferential allotment, all of which happened prior to March 30, 2013, cannot therefore be attributable to Amit Kumar Vasishtha and Rameshwar Manohar Wagh.

80. In respect of Anand Gupta (Noticee No. 6 ) Vijay Kumar Jain (Noticee No. 7 ), it is seen that they were directors in the Company since 2001 and 2007 respectively, and continued to be directors till March 30, 2013. So, it is a fact that the above named Noticees were part of the Board of Directors, which was involved in the decisions regarding the preferential allotment. That being the case, the above named Noticees have stated that they were never responsible for any corporate action after the date of appointment of representatives of the new management, namely Ankit Ompraksh Garodia and Jugal Kishore Sharma i.e., February 21, 2012, and that they never attended any Board or general meeting subsequent to the said date. Affidavits have been filed to support this assertion. The Noticees’ assertion that they were not involved in any corporate action although they were a part of the Board is vacuous, contradictory and illogical. If they were not part of any corporate action, they should have resigned their positions on the Board immediately. Given that they were associated with the Board right till March 2013, when the Board took important financial decisions, I am not inclined to make any specific exception in respect of Anand Gupta (Noticee No. 6 ) and Vijay Kumar Jain (Noticee No. 7 ).

81. In light of the above, I find that the following Directors of the Company: Ankit Om Prakash Garodia (Noticee No. 2 ), Jugalkishore Sharma (Noticee No. 3 ), Anand Gupta (Noticee No. 6 ) and Vijay Kumar Jain (Noticee No. 7) having been entrusted with the responsibility, as members of the board of directors, of doing all acts for giving effect to the said resolution and consequent thereto, using the proceeds of the preferential allotment in contravention of the objects of the said preferential allotment, are liable for the violation of Section 12A (a), (b) and (c) of SEBI Act, 1992 and Regulations 3 (a), (b), (c), (d), 4(1), 4(2)(f)(k) and (r) of SEBI (PFUTP) Regulations, 2003. With regard to Vijay Kumar Jain, a copy of the death certificate, issued by the Municipal Corporation of South Delhi, certifying his death has been received from Deepak Sharma, his authorised representative by way of email dated October 28, 2020. In the said circumstances, the present proceedings against late Vijay Kumar Jain, stands abated.

II. Whether the directors of Roongta Rising Stock Pvt Ltd (Noticee Nos. 8 and 9) acted simply as agents or were they involved in devising the scheme of manipulating the price of the scrip by issuing an advertisement and buying shares from the promoter entities?

82. The SCN has alleged that RRSPL had devised a scheme to manipulate the price of the scrip by issuing an advertisement, buying shares from the promoter entities and manipulating the price of the scrip through 53 entities. Further, RRSPL dealt in the suspended scrip and issued fake contract notes. As a company functions through its directors, Anil Satyanarayan Roongta and Sudha Anil Roongta (Noticee Nos. 8 and 9) being directors of RRSPL, are alleged to have violated provisions of Regulations 3(a)(b)(c)(d) and 4(1) of SEBI (PFUTP) Regulations, 2003.

83. The Roongta entities in their replies have inter alia submitted that 83.1. The entire transaction was sourced and concluded by Subhash Maheshwari and RRSPL acted as a broker to the transactions between the said buyers and the sellers. Annexure-8 of the SCN enclosed a Memorandum of Understanding executed on stamp paper between Vijay Kumar Jain and Subhash Maheshwari dated November 24, 2011, wherein he was mandated to sell shares of Mishka.

83.2. SEBI had sought copies of Contract Notes from RRSPL. Investigation has stated that RRSPL printed such contract notes from its back office and provided the same to SEBI. The SCN expresses reservation that RRSPL provided printed contract notes and not the acknowledged contract notes. Acknowledgements are required to be maintained for confirming whether the broker has delivered the contract notes to the clients or not. The regulation / byelaws of NSE were inadvertently quoted in small font on top of the contract note and the footnotes, even though, the sale was in respect of shares listed on the BSE.

83.3. The construction of the back office software is such that for generating contract notes certain fields are mandatory and therefore the back office clerks generating the contract notes entered some order id, trade id and time to generate the contract note.

83.4. The shares were transferred directly from the sellers to the buyers, as would be clear from the records of the RTA, and therefore the allegation that RRSPL acted as a principal is incorrect.

83.5. Also, the rates of brokerage specified in the Contract Notes were as directed by Subhash Maheshwari, who instructed the issuance of contract notes at all-inclusive rates, for which separate brokerage was not reflected in the contract note. As evident from the Agreement between the sellers and Mr. Subhash Maheshwari, the total consideration for the transaction would have been 24.90 Lakhs and the brokerage thereon at this rate would have been a negligible amount of Rs. 2490/-on one side. As this amount was not significant, request was made by a senior citizen viz. Mr. Subhash Maheshwari and as the present Noticees were also getting to invest in the shares of Mishka, RRSPL issued contract notes without brokerage.

83.6. RRSPL never issued any such advertisement and the advertisement does not purport to state the name Mishka. Information was sought from the newspaper for the details of the advertiser; in response to which the newspaper company informed that details cannot be provided unless the same is pursuant to a police complaint. Accordingly, a complaint has been lodged with the police for investigation in the matter. Further, despite the name of Bhadresh Shah appearing in the advertisement, it has been sworn by him on an affidavit that he did not place the advertisement and did not receive any call from the entities for the shares of Mishka.

83.7. Certain purchasers namely, Neha Narayan Toshniwal (date of purchase: 30/04/2012), Parul Rupesh Poddar (date of purchase: 30/04/2012), Rupesh Poddar (date of purchase: 30/04/2012) and Kiran Narayan Prasad Toshniwal (date of purchase: 15/06/2012) have claimed that they purchased shares based on the newspaper advertisement, even though the newspaper advertisement was allegedly issued on September 17, 2012. The said entities live in different cities and in some instances in different states, and at several such places the Economic Times Mumbai Edition is not even circulated.

83.8. SEBI has failed to provide any provision of law which provides that a broker is not allowed to act as agents in scrips like Mishka, i.e. scrips which have been suspended from trading for reasons like failure to file documents with the exchange, non-payment of listing fee etc.

83.9. It is settled law that an allegation of conspiracy cannot be upheld against one party to the conspiracy while all others are being let off. This is pertinent in the recent judgments of the Hon'ble SAT in the cases of KII Ltd. and Pat Financial Services. In the facts and circumstances of the present case, while the actual parties who have traded in the shares (promoters and 383 transferee entities) are not charged, but he has been charged for being a director of the broking company.

83.10. I also note that the Roongta entities had made a request for full inspection of records with SEBI, which included summons/letters issued to the off-market buyers, certain documents relating to the appeals filed before SAT, details of efforts taken by SEBI to check the issuer of the alleged advertisement etc. Further, the Roongta entities had sought the cross-examination of those buyers who had stated that they relied on the advertisement to purchase the shares. I find that SEBI has not inferred about the knowledge and involvement of the Roongta entities in the matter merely based on certain statements/replies of the buyers. An overall reading of the Investigation Report brings out the fact that the Investigation has drawn inference against the Roongta entities based on various factors viz., the fund flow, the manipulation pattern, the sequence of events from the MOU followed by the single-point dealing of shares by RRSPL during the suspension of Mishka and the fact that all the buyers bought the shares through RRSPL exclusively. It is noted that the request for full inspection and cross-examination does not hold merit, in the facts and circumstances of the case.

84. I have carefully considered the charges listed out in the SCN and the replies furnished by the Noticees thereto. Generally, the modus operandi that has been observed by SEBI in many LTCG matters, including the present one, is that penny stocks are first identified; thereafter they are listed on the stock exchange or the pending suspension is revoked; subsequently towards the end of the lock in period of the new subscribers, the price of the scrip is artificially jacked up and finally, the shares are dumped at higher prices in the market on gullible public. The intent of such schemes is twofold: a) to give shares with very little market value an impression of trading and then booking profits by selling these shares at artificially created high prices; and b) misusing the securities market system to avoid payment of taxes on Long Term Capital Gains. I do not intend to get into the LTCG angle of the scheme, allegedly devised by RRSPL and its Directors, as the same is beyond the purview of this order. In this connection, it may be recalled that the investigation in the present case was necessitated on the receipt of a reference from the Income Tax Department. However, the scope of this order is to examine the market manipulation aspect and the related roles played by the Noticees in such manipulation.

85. In this regard, Investigation has revealed that six Promoters and Promoter related entities of Mishka had transferred 99.60% of their shareholding (4,96,000 shares) to 383 entities and out of which 19 entities further transferred their shareholding to 69 entities. Therefore ultimately, 99.60% of promoter shareholding was transferred to 452 entities.

86. The transfer of shares from the six Promoters and Promoter related entities of Mishka to the buyers, is analysed as shown below. As per the shareholding pattern received from BSE, the total shareholding of the company was 4,98,000 shares as on September 30, 2011 (entire shares were in physical mode) of which 4,19,700 shares i.e. 84.28% of total shareholding were held by four Promoter entities of the company namely Embassy Finance & Consultants Pvt Ltd, Wave Inter Trades Pvt Ltd, Tohee Trading & Agencies Pvt Ltd, and Sulabh Impex Limited and remaining 78,300 shares i.e. 15.72% of total shareholding were held by three entities namely Vijay Kumar Jain, Ankit Jain and Rashmi Jain, the details of which are as follows:

Shareholding Pattern of Mishka as on September 30, 2011

Table-12

Sr. No. Name Category No. of % of Total Shares Paid up Held Capital

As on 30-Sep-2011

1 Embassy Finance & Consultants Promoter 1,24,500 25.00% Pvt Ltd

Promoter 2 Tohee Trading & Agencies Pvt Ltd 1,21,200 24.34%

Promoter 3 Wave Inter Trades Pvt Ltd 1,24,000 24.90%

Promoter 4 Sulabh Impex Limited 50,000 10.04%

Total Promoter Shareholding (A) 4,19,700 84.28%

5 Vijay Kumar Jain Director 36,000 7.23%

Son of 6 Ankit Jain 32,000 6.42% Director

Wife of 7 Rashmi Jain 10,300 2.07% Director

Total Non Promoter Shareholding (B) 78,300 15.72%

Total Shareholding of the company (A+B) 4,98,000 100.00%

87. Thus, the entire shareholding of the company was with the aforesaid seven connected entities only. It was observed from transfer data received from Registrar and Transfer Agent (“RTA”) of the company (Annexure 7), that on December 26, 2011, Sulabh Impex Limited transferred its entire shareholding of 50,000 shares to Ankit Jain in off-market. Thereafter, six entities (four Promoter entities namely Tohee Trading & Agencies Pvt Ltd, Wave Inter Trades Pvt Ltd, Embassy Finance and Consultants Pvt Ltd and Vijay Kumar Jain and relatives of Promoter namely Ankit Jain and Rashmi Jain) (hereafter referred to as “six Promoter and Promoter related entities”) transferred their entire shareholding (except 2,000 shares of Embassy Finance & Consultants Pvt Ltd) i.e. 4,96,000 in off-market in physical form to 383 entities during the period December 30, 2011 to February 04, 2013 on 12 dates. The details of transfer are as follows:

Table-13

S. No. Date of No. of shares No. of Transfer Transferred entities

1 30-Dec-2011 71,700 15

2 30-Apr-2012 17,200 20

3 15-Jun-2012 1,11,100 137

4 5-Dec-2012 94,000 54

5 12-Dec-2012 14,000 14

6 19-Dec-2012 24,900 24

7 26-Dec-2012 10,000 10

8 31-Dec-2012 27,500 25

9 15-Jan-2013 28,100 27

10 21-Jan-2013 31,000 26

11 31-Jan-2013 30,000 25

12 4-Feb-2013 36,500 20

Total 4,96,000 397**

**It was observed that out of 397 entities, 14 entities received shares twice on two different dates from two different entities. Therefore, total unique entities were 383 (397-14) who received shares in off-market. 88. RRSPL has contended that it was approached by one Subhash Maheshwari who informed that he had buyers who were willing to purchase the shares of Mishka. RRSPL further stated that the entire transaction was sourced and concluded by Subhash Maheswari and that it acted as a broker between the buyers and sellers. This contention however does not seem to be true and correct. Annexure – 8 of the SCN shows that RRSPL had written a letter (undated) to Tohee Trading & Agencies Pvt Ltd, recommending names of 15 persons “ who are willing to buy your 71700 shares held in the Pyramid Trading and Finance Ltd. at 5 rupees per share.” It is noted from the trading details as received from the RTA, that the said 71,700 shares were in fact transferred by Tohee Trading & Agencies Pvt Ltd. The details of the said transfers are as under:

Table No. 14

Transfers of shares of Mishka Finance and Trading Limited in physical form during the period from October 01, 2011 to December 31, 2013

DATE TRANSFERER TRANSFEREE NO OF NAME NAME SHARES TRANSFERR ED 30-Dec- TOHEE TRADING & SANJAY ZENDE 4900 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & JAYESH SHAH 4500 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & JAYESH 4600 2011 AGENCIES PVT LTD DEVGHARKAR

30-Dec- TOHEE TRADING & TEJAS GALA 4865 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & MANISHA SHAH 4500 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & ARTI KANSARA 4800 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & SHAILESH PANDYA 4915 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & JANARDAN 4800 2011 AGENCIES PVT LTD RAMSAKAL SHARMA

30-Dec- TOHEE TRADING & SARITA DEVI MALL 4850 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & PRADIP YADAV 600 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & PRADIP YADAV 2500 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & PRADIP YADAV 1810 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & PRAKASH G REVALE 4700 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & SUNIL MOHAN 4660 2011 AGENCIES PVT LTD KANSARA

30-Dec- TOHEE TRADING & SOMNATH BOMBLE 4900 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & SUKRIT GHOSH 4900 2011 AGENCIES PVT LTD

30-Dec- TOHEE TRADING & SANJEEV SINGH 4900 2011 AGENCIES PVT LTD

TOTAL 71700

89. I also note that Vijay Kumar Jain in his reply has stated about the execution of an MOU with Subhash Maheshwari whereby he had agreed to transfer 4,98,000 equity share to him at a consideration of Rs. 5 per share. According to V K Jain, the intention of the MOU was to record that the transferor promoters/shareholders were not responsible or liable to list the shares of the company on BSE. He had also undertaken to continue to act as director in the Company till the revocation of suspension of the company on BSE. I note that the underlying idea behind the MOU is admittedly an off market transfer of shares which were in physical form. In the chronology of events furnished by V K Jain, it is seen that on 19.03.2012 he had transferred 68,000 shares to Subhash Maheshwari and his nominees/assignees through RRSPL. V.K. Jain had received the consideration directly from RRSPL, which fact is supported by the copy of the receipt of RRSPL, Bank statement and other related papers. As per V K Jain’s reply, after the signing of the MoU with Subhash Maheshwari, he introduced him to one mediator/broker namely, RRSPL. This, he states was “ for the smooth transfer of shares of the company and to complete the transfer of shares process” Thus, undisputedly, the off-market transaction in a suspended scrip was arranged by RRSPL, subsequent to the execution of the MoU. I note from the MoU that there was a plan for change of name of the Company in RoC; a plan to revoke the suspension with BSE; a plan to get the company listed on the exchange and a plan to shift the office to another place. It was also mutually agreed between Subhash Maheshwari and V K Jain that an RTA would be appointed in Mumbai by Subhash Maheshwari and all records related to the shares would be handed over to them. I note that the consideration of Rs. 24,80,000 was received by the seller promoters from the account of RRSPL.

90. Now the question is whether RRSPL acted as a broker for Subhash Maheshwari or was it acting as a principal to the transactions. As stated earlier, Embassy Finance and Consultants Pvt Ltd, Ankit Jain, Rashmi Jain, V K Jain, Anand Gupta, Tohee Trading & Agencies Pvt Ltd, Wave Inter Trades Pvt Ltd have all provided proof of payment of consideration from RRSPL. First and foremost, it is beyond comprehension as to why a broker is required for off-market transactions between the set of parties shown in the MoU, especially when the shares are in physical form. It is emphasized that going by V K Jain’s reply the first party and the second party in MoU knew each other at the time of execution and the broker came into the picture only thereafter. RRSPL, claiming to be the Broker, failed to produce any document to show that Subhas Maheshwari had in fact bought the shares from the promoters of Mishka.

91. Investigation has also placed reliance on the advertisement in ET - supposedly published on 17/09/2012. The advertisement with the reference of “Ajay Banka” of “Roontga” hand written on it has been annexed in the SCN as Annexure- 10 of the SCN. The Roongtas have tried to punch holes with respect to the advertisement by stating that 452 entities have not relied on the advertisement; four buyers had bought shares prior to the advertisement; that it is not possible for buyers living outside Mumbai to get the copy of the advertisement with the same hand written endorsements on it etc. To sum up, the Roongtas have denied the disbursement of shares to 452 entities through the advertisement. On the other hand, the Roongtas have placed reliance on the MOU to state that V K Jain had agreed to sell the shares to Maheshwari and it was just a broker in the deal. Thus, indirectly RRSPL is trying to create a mystery behind the availability of the same advertisement with several entities. RRSPL has gone to the extent of denying the whole exercise of advertisement. RRSPL is also unable to explain the presence of Bhadresh Shah’s name (one of its authorized signatories) in the advertisement. RRSPL has made a faint attempt to show that it has tried to discover the person who caused the advertisement to be published. It is being stated that RRSPL has lodged a police complaint with the Surat Police in this regard. The contents of the advertisement reads as : “We deal in Physical/Odd Lot shares of all Cos. Contact Roongta Rising Stock Pvt. Ltd. Bhadresh: 09898554161”. I note that the name of Mishka does not figure in the advertisement.

92. Despite all the mystery surrounding the publication of the advertisement, it is a fact that there was an advertisement in ET for dealing in odd lot of shares of all companies by RRSPL during September 2012. It is an uphill task for the investigation to establish that 452 entities had bought the shares solely relying on the advertisement. I acknowledge that the investigation has attempted to show that RRSPL had become a single contact point for the buyers of the scrip through the conscious attempt on the part of the Roongtas. However, I do not want to shift my focus from the main issue of whether RRSPL acted as a broker or was itself a principal, by getting distracted on minor issues such as the advertisement etc. It is relevant for me to note that the scrip was itself an unknown name in the trading spheres, and still it could reach the hands of 452 entities, all through RRSPL.

93. At the same time, I note that the MOU between V K Jain and Subhash Maheshawri also does not lead one to any conclusion because there is no evidence showing the fructification of the MOU. Neither has V K Jain produced it nor has the broker, RRSPL produced it. In the absence of such evidence the MOU can only be seen to evidence the desire of VK Jain to transfer his and his related entities’ shareholding to Maheshwari. Subhash Maheshwari was not available for examination to the investigation team of SEBI as he had passed away by that time. It cannot be denied that RRSPL had knowledge of the MOU and the intended transfer of shares by the seller promoters.

94. In this connection, the crucial question is who bought the shares from the promoters such that it could reach a larger section of the investors. Incidentally, I note that the investigation has brought out all the differences in the format and content between the contract note copies tendered by the RRSPL vis- a-vis the ones tendered by the buyers of RRSPL. On the analysis of the differences, the investigation has alleged that RRSPL has generated fake contract notes. I find that the distinction between Annexure –9 and 11 of the SCN does not bear a great significance in the context of the present Section 11 B proceedings. One of the reasons for this is the fact that there has been no one-to-one comparison of the contract notes transaction-wise. As such, there is no genuine need for issue of a contract note for an off-market transaction in a suspended stock like Mishka. Still, I note that RRSPL had issued contract notes to some buyers to show on record that they were acting as a broker for those clients. The question still remains open as to why all the buyers went to RRSPL to buy Mishka’s shares, and why nobody bought Mishka’s shares from anybody else. I note that whether the documents evidencing transfer match or not, ultimately, the transfer of shares through RRSPL is not denied, given the strong evidence of funds transfer discussed later.

95. In connection with the transfer of shares to the set of buyers identified by the investigation, RRSPL contended that the shares were transferred directly from the sellers to the buyers. It was further contended that the rates in the contract notes were as directed by Subhash Maheshwari and were all-inclusive rates, for which separate brokerage was not reflected. It was also stated that brokerage for a transaction for 24.90 lakhs would have been a negligible 2490 on one side. Besides this amount not being material a request was made by Subhash Maheshwari, who was a senior citizen and an opportunity was given to RRSPL to also invest in the shares.

96. The question as to whether the Roongtas acted as a principal or as an agent broker is worth consideration. I note that the MOU has already become a paper document without materialization of the transfer of shares to Subhash Maheshwari. I find that the Roongtas are emphatically holding out the said MOU against the allegation of it being involved in the capacity as the principal.

97. The points enumerated in the IR /SCN to state that RRSPL acted as a Principal are : i) movement of funds directly from RRSPL’s account to the erstwhile promoters; ii) non-levy of brokerage for the transactions; iii) Roongtas served as the single point contact for the all the buyers who were interested in purchasing the shares of the Company.

98. As regards the fund movement, the IR/SCN has categorically brought out that the seller promoters received payment of Rs. 21, 21, 500 (85.54%) directly from RRSPL and Rs. 3,58,500 (14.46%) directly from the buyers. I find that there is no explanation whatsoever forthcoming from RRSPL in this respect.

Table-15

S N Name of No. of Consideration Amount of Date when Entity shares (Rs.5 per Consideration consideration transferred share) Received from received as per RRSPL Bank statement

1 Embassy 1,22,500 6,12,500 6,12,500 12.10.2012 Finance & Consultants Pvt Ltd

2 Tohee Trading 1,21,200 6,06,000** 2,47,500 12.10.2012 & Agencies Pvt Ltd

3 Wave Inter 1,24,000 6,20,000 6,20,000 12.10.2012 Trades Pvt Ltd

4 Vijay Kumar 68,000 3,40,000 3,40,000 04.04.2012 & Jain 18.04.2012

5 Ankit Jain 50,000 2,50,000 2,50,000 04.04.2012

6 Rashmi Jain 10,300 51,500 51,500 18.04.2012

Total 4,96,000 24,80,000 21,21,500

** As per reply of Tohee Trading & Agencies Pvt Ltd, they received consideration of Rs. 3,58,500 (6,06,000 – 2,47,500) in cash from 15 entities directly on instructions of RRSPL. 99. It is further noted that RRSPL failed to show the fund flow from the buyers to its account, preceding the onward transfer to the seller-promoters. As regards, the non-levy of brokerage, the explanation that the issuance of contract notes was at an all-inclusive rate for which separate brokerage was not charged is not acceptable. I also note that the Company had no fundamentals or operations which made it appealing to RRSPL to invest, when it was suspended. The very fact that RRSPL itself invested in the subject shares shows that it was aware of the ensuing revocation of suspension and the opportunities that would follow thereafter. Annexure – 8 of the SCN apparently shows that RRSPL had identified the 15 buyers and recommended their names to the promoter sellers for transfer at Rs. 5 per share. Therefore, the contention of RRSPL that the rates were specified in the contract notes, as directed by Maheshwari, and that it was an all-inclusive rate is contradictory. The stand of RRSPL on the brokerage also contradicts with its own stand that it being a negligible amount, it was not levied. I find that RRSPL is not having any consistency in the stance taken in this regard. Added to these inconsistencies, I find that there are a whole set of receipts, bank deposit statements, other related disclosures filed by the erstwhile promoters which unambiguously bring out the role of Roongtas in the whole deal.

100. Thus, on an overall evaluation of the facts and circumstances related to the transfer of shares of Mishka from the promoter entities to the 452 investors, I am inclined to go by preponderances which strongly point towards the Roongtas having a definite role in planting the fraudulent scheme in the securities market whereby a penny stock has been identified, activated (by removal of suspension, change of name /office etc.) and subsequently, transferred to several entities in the market. This part of the transaction initiating from the act of purchase of the promoter shares and spreading it out in the market, is itself per se manipulative and fraudulent. Subsequently, the Roongtas have also manipulated the price of the scrip, which is being dealt under the head Issue no. III. Certainty, I find that RRSPL has acted as a principal and not as a broker to the clients and misused its broker authorization to that extent. Accordingly, I hold that Noticee No. 8 and 9, who are directors of RRSPL have violated provisions of Regulations 3(a)(b)(c)(d) and 4(1) SEBI (PFUTP) Regulations, 2003. The monetary benefit garnered by the aforesaid Noticees is discussed hereunder.

III. Whether the trades of the 41 remaining Noticees (including Anil Roongta, Sudha Roongta and A K Roongta HUF) i.e. Noticee Nos. 8 to 16; 18 to 23; 27 to 28; 31 to 33; 35 to 46; 49 to 53; and 57 to 60 amounted to manipulation of price of the scrip in Patch-1 (14-Feb-13 to 15-Jan-14) and Patch-2 (16-Jan-14 to14-Feb-14) in terms of SEBI PFUTP Regulations?

101. It has been inter alia alleged in the SCN that the 53 Noticees i.e, all the Noticees except Noticee Nos. 1 to 7, indulged in acts that amounted to manipulation of price of the scrip in Patch-1 and Patch-2 periods. It has been further alleged in the SCN that of out of the 53 Noticees, 50 Noticees consequent to manipulation of price booked substantial profits by selling the shares at inflated prices.

102. As already stated in this order, allegations in the SCN against 12 Noticees have been settled by way of Settlement Order dated September 24, 2020. Accordingly, for the purpose of this order, the allegation of manipulation of price of the scrip in Patch-1 and Patch-2 periods is with respect to 41 Noticees (i.e., Noticee Nos. 8 to 16; 18 to 23; 27 to 28; 31 to 33; 35 to 46; 49 to 53; and 57 to 60). Further, the allegation of profit booking from the sale of the shares of Mishka at inflated prices is with respect to 38 Noticees i.e., Noticee Nos. 8 to 16; 18 to 23; 27 to 28; 31 to 33; 35 to 46; 49 to 53; and 57.

103. In this regard, the SCN has stated that during Patch-1, the price of the scrip opened at Rs.5.50 on February 14, 2013 and reached Rs.327.25 on January 15, 2014 and closed at Rs.327.25 on January 15, 2014, registering a price rise of Rs.321.75.

104. The trading data has revealed that during the period of price rise as stated above, the scrip was traded on 167 trading days and 222 trades took place. The details of analysis of LTP contribution has revealed that the 41 remaining Noticees in the matter, who received shares directly or indirectly from promoters and promoter related entities through RRSPL, traded in Patch-1 as sellers. From an analysis of the 166 trades that contributed Rs.321.85 to the gross positive LTP, it was observed that 130 trades were carried out by the abovementioned 41 Noticees as sellers, thereby contributing Rs.278.12 (i.e. 86.40%of gross positive LTP).

105. The details of the trades of the 41 Noticees are as follows:

Table-16 – Price Manipulation (LTP) in Patch-1 % of +ve LTP to Net LTP Positive LTP Negative LTP Zero LTP Total Market S Seller PAN Seller Name +ve LTP N No No -ve No of Tot No of Net Total of +ve Total of Total LT trade al trade LTP Qty trad LTP Qty trad Qty P s Qty s es es Tushar Ashok 1 AFZPT5149K 21.9 31 8 21.9 31 8 - - - 6.80% Thakur - - 2 AKCPS7427B Vikram Shah 21.2 35 8 21.2 35 8 - - - 6.59% - - Mehta Tejal 3 ABQPM1056P 20.45 20 7 20.45 20 7 - - - 6.35% Piyush - - Asifatanveer 4 CNAPS8962G Mohammadish 19.45 34 7 19.45 34 7 - - - 6.04% - -aq Shaikh Priyanka ATRPM4285 5 Pramod 19.1 40 7 19.1 40 7 - - - 5.93% D - - Mhapsekar Kiritkumar AHXPM6863 6 Ramniklal 18.9 28 7 18.9 28 7 - - - 5.87% F - - Mehta Mansi Manoj 7 AJFPR5740L 18.1 23 8 18.1 23 8 - - - 5.62% Rane - - Omprakash 8 BQFPS5917N Ramdev 17.15 26 8 17.15 24 7 - - 2 1 5.33% - Shrma AMYPD3165 Rakeshkumar 9 16.7 40 6 16.7 40 6 - - - 5.19% F Dixit Usha - - Manish Kumar 10 APPPB5638F 15.45 19 5 15.45 19 5 - - - 4.80% Bhati - - Ashish 11 BPXPS8075L 15.25 25 5 15.25 25 5 - - - 4.74% Ishwarlal Shah - - Mukesh 12 BAPPK2160M 14.55 21 5 14.55 21 5 - - - 4.52% Kumar - - Tejas Vasant 13 AZAPG1972C 14.4 16 6 14.4 16 6 - - - 4.47% Gala - - Manharlal 14 AAKPS3276J Narottamdas 7.85 15 3 7.85 15 3 - - - 2.44% - - Shah Chandravati 15 AAKPS3275M Manharlal 7 9 2 7 9 2 - - - 2.17% - - Shah Ketan AMHPM0156 16 Jumakhlal 4.75 5 1 4.75 5 1 - - - 1.48% A - - Mehta AAGHV5661 Vijay Kumar 17 1.9 3 2 1.9 3 2 - - - 0.59% L Soni (Huf) - - Ritu Sandeep 18 AAHPB4095P 1.8 4 3 1.8 4 3 - - - 0.56% Saraf - - Kanta 19 AAJPJ4245M 1.78 2 2 1.78 2 2 - - - 0.55% Balkishan Jaju - - Sandeep 20 ANQPS5905F Vishwanath 1.7 4 3 1.7 4 3 - - - 0.53% - - Saraf

% of +ve LTP to Net LTP Positive LTP Negative LTP Zero LTP Total Market S Seller PAN Seller Name +ve LTP N No No -ve No of Tot No of Net Total of +ve Total of Total LT trade al trade LTP Qty trad LTP Qty trad Qty P s Qty s es es 21 ABBPR3992G Anil Roongta 1.66 6 3 1.66 6 3 - - - 0.52% - - Hem Raj 22 AFOPR0263B 1.66 7 3 1.66 7 3 - - - 0.52% Raneja - - Pawankumar 23 AAAPD9261A 1.2 8 2 1.2 4 1 - - 4 1 0.37% Motilal Darak - AANPT7118 Sunita Harish 24 1.15 3 1 1.15 3 1 - - - 0.36% D Toshniwal - - Sorabh Kumar 25 AELPP0173Q 1.1 1 1 1.1 1 1 - - - 0.34% Poddar - - BNNPK9250 26 Kavita Raneja 1.03 3 2 1.03 3 2 - - - 0.32% R - - 27 AIUPR9150N Anand Raneja 1 3 2 1 3 2 - - - 0.31% - - 28 AKKPP3508Q Parul Poddar 1 2 1 1 2 1 - - - 0.31% - - 29 ASZPS1277J Savita Soni 0.9 2 1 0.9 2 1 - - - 0.28% - - Rupesh 30 AELPP0183N 0.79 2 1 0.79 2 1 - - - 0.25% Kumar Poddar - - Neha Narayan 31 ANZPT6807C 0.75 3 1 0.75 3 1 - - - 0.23% Toshniwal - - Nikunj 72,75 66,7 32 AYOPA2382B Sandeep 0.65 51 0.75 5,000 1 -0.1 1,000 1 49 0.23% 0 50 Agarwal Vinita Sanjay 33 ABGPJ9502P 0.75 5 1 0.75 5 1 - - - 0.23% Joshi - - Kiran 34 ABHPT5940L Narayanprasad 0.65 4 1 0.65 4 1 - - - 0.20% - - Toshniwal 35 AGBPJ8881F Sunayana Jain 0.65 3 1 0.65 3 1 - - - 0.20% - - Sanjay 36 ABGPJ9472Q 0.6 5 1 0.6 5 1 - - - 0.19% Ambadas Joshi - - AAAPW9319 Megha Ravi 37 0.5 3 1 0.5 3 1 - - - 0.16% A Wattamwar - - Ravi B 38 AALHR3103E Wattamwar 0.45 3 1 0.45 3 1 - - - 0.14% - - Huf Sudha Anil 39 AAQPR4466F 0.45 2 1 0.45 2 1 - - - 0.14% Roongta - - Sainik Kumar 40 ABYPJ9823B 0.34 2 1 0.34 2 1 - - - 0.11% Jain - - AABHA9528 A K Roongta 41 1.36 4 2 1.36 4 2 - - - 0.42% A Huf - - 73,22 278.1 66,7 41 Entities Total 278.02 182 5,465 130 -0.1 1,000 1 51 86.40% 1 2 56 Remaining 43.73 250 40 43.73 242 36 - - - 7 3 13.60% 73,47 321.8 66,7 Grand Total 321.75 222 5,707 166 -0.1 1,000 1 54 100.00% 1 5 63

106. In Patch-2 period, equity shares of the Company were split in the ratio of 10:1, with effect from January 16, 2014. Subsequently, the price of the scrip opened at Rs.33.35 on January 16, 2014 and reached Rs.49.90 on February 14, 2014 and closed at Rs.49.90 on the same day, registering a price rise of Rs.16.55.

107. It was seen from the trading data that during Patch-2, the scrip was traded on 22 trading days and 25 trades took place. The trading data revealed that 14 entities out of 41 Noticees traded in Patch-2 as sellers. With respect to the said 14 entities, from an analysis of LTP contribution, it was observed that 15 trades carried out by the aforesaid Noticees on the sell side contributed Rs.11.55 (i.e. 69.80% of gross positive LTP).

108. The details of the said trades are as follows:

Table-17 – Price Manipulation (LTP) – Patch 2 S Seller PAN Seller Name Net LTP Positive LTP Negative LTP Zero LTP % of +ve N LTP to Net Total No of Positiv Total No No No of Total LTP Qty trade e LTP Qty -ve Total of Tota of trade Market s LTP Qty trade l Qty trade s +ve LTP s s 1 AMHPM0156A Ketan Jumakhlal 1.6 22 2 1.6 22 Mehta 2 - - - - - 9.67% 2 AFZPT5149K Tushar Ashok 0.95 9 1 0.95 9 Thakur 1 - - - - - 5.74% 3 AKCPS7427B Vikram Shah 0.9 15 1 0.9 15 1 - - - - - 5.44%

S Seller PAN Seller Name Net LTP Positive LTP Negative LTP Zero LTP % of +ve N LTP to Net Total No of Positiv Total No No No of Total LTP Qty trade e LTP Qty -ve Total of Tota of trade Market s LTP Qty trade l Qty trade s +ve LTP s s

4 CNAPS8962G Asifatanveer 0.85 15 1 0.85 15 Mohammadishaq Shaikh 1 - - - - - 5.14%

5 ATRPM4285D Priyanka Pramod 0.85 10 1 0.85 10 Mhapsekar 1 - - - - - 5.14%

6 AHXPM6863F Kiritkumar 0.8 14 1 0.8 14 Ramniklal Mehta 1 - - - - - 4.83%

7 BPXPS8075L Ashish Ishwarlal 0.75 5 1 0.75 5 Shah 1 - - - - - 4.53%

8 AMYPD3165F Rakeshkumar 0.75 15 1 0.75 15 Dixit Usha 1 - - - - - 4.53%

9 AAKPS3276J Manharlal 0.7 14 1 0.7 14 Narottamdas Shah 1 - - - - - 4.53%

10 APPPB5638F Manish Kumar 0.7 12 1 0.7 12 Bhati 1 - - - - - 4.23%

11 AJFPR5740L Mansi Manoj 0.7 12 1 0.7 12 Rane 1 - - - - - 4.23%

12 BQFPS5917N Omprakash 0.7 10 1 0.7 10 Ramdev Shrma 1 - - - - - 4.23%

S Seller PAN Seller Name Net LTP Positive LTP Negative LTP Zero LTP % of +ve N LTP to Net Total No of Positiv Total No No No of Total LTP Qty trade e LTP Qty -ve Total of Tota of trade Market s LTP Qty trade l Qty trade s +ve LTP s s

13 BAPPK2160M Mukesh Kumar 0.65 20 1 0.65 20

1 - - - - - 4.23%

14 AZAPG1972C Tejas Vasant 0.65 15 1 0.65 15 Gala 1 - - - - - 3.93%

14 LTP Contributors Total 11.55 188 15 11.55 188 15 - - - - 69.80% -

Remaining 5 101 10 5 77 6 - - - 24 4 30.20%

Grand Total 16.55 289 25 16.55 265 21 - - - 24 4 100.00%

Sell Side Manipulation

109. In respect of the trades carried out by the 41 Noticees in Patch-1, it has been alleged in the SCN that though the buy orders were available for large quantities (ranging from 10 to 10,000 shares), the said 41 Noticees were placing sell orders in small quantities or single digits i.e., mostly 1 to 10 shares. In this regard, it would be relevant to place hereunder the details of the sell orders placed by the 41 Noticees and the existing buy orders in the system at the time of such sell orders.

Table-18- Price Manipulation (Sell Side)- Patch 1

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 13/09/2013 AAAPD9261A PAWANKUMAR 4 2,500 1.2 100 96 MOTILAL DARAK Total 4 2,500 1.2 25/06/2013 AAAPW9319A MEGHA RAVI 3 5,000 0.5 4,000 3,997 WATTAMWAR Total 3 5,000 0.5 03/06/2013 AAGHV5661L VIJAY KUMAR SONI 2 5,000 0.85 4,800 4,798 (HUF) 10/06/2013 AAGHV5661L VIJAY KUMAR SONI 1 5,000 1.05 4,798 4,797 (HUF) Total 3 10,000 1.9 04/07/2013 AAHPB4095P RITU SANDEEP SARAF 2 5,000 0.55 4,000 3,998 11/07/2013 AAHPB4095P RITU SANDEEP SARAF 1 5,000 0.6 3,998 3,997 17/07/2013 AAHPB4095P RITU SANDEEP SARAF 1 5,000 0.65 3,997 3,996 Total 4 15,000 1.8 30/05/2013 AAJPJ4245M KANTA BALKISHAN 1 5,000 0.83 4,000 3,999 JAJU 05/06/2013 AAJPJ4245M KANTA BALKISHAN 1 5,000 0.95 3,999 3,998 JAJU Total 2 10,000 1.78 24/10/2013 AAKPS3275M CHANDRAVATI 5 2,500 2.05 50 45 MANHARLAL SHAH 27/12/2013 AAKPS3275M CHANDRAVATI 4 2,500 4.95 45 41 MANHARLAL SHAH Total 9 5,000 7 26/09/2013 AAKPS3276J MANHARLAL 4 2,500 1.45 50 46 NAROTTAMDAS SHAH 18/11/2013 AAKPS3276J MANHARLAL 6 2,500 2.85 46 40 NAROTTAMDAS SHAH 03/12/2013 AAKPS3276J MANHARLAL 5 2,500 3.55 40 35 NAROTTAMDAS SHAH Total 15 7,500 7.85 21/06/2013 AALHR3103E RAVI B WATTAMWAR 3 5,000 0.45 4,000 3,997 HUF Total 3 5,000 0.45

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 11/09/2013 AANPT7118D SUNITA HARISH 3 2,500 1.15 100 97 TOSHNIWAL Total 3 2,500 1.15 14/06/2013 AAQPR4466F SUDHA ANIL 2 5,000 0.45 20,000 19,998 ROONGTA Total 2 5,000 0.45 12/04/2013 ABBPR3992G ANIL ROONGTA 2 900 0.36 49,600 49,598 09/07/2013 ABBPR3992G ANIL ROONGTA 2 5,000 0.55 Broker (Roongta) confirmed that these 31/07/2013 ABBPR3992G ANIL ROONGTA 2 5,000 0.75 trades were settled as per Exchange Auction/Close out Norms Total 6 10,900 1.66 16/07/2013 ABGPJ9472Q SANJAY AMBADAS 5 5,000 0.6 8,000 7,995 JOSHI Total 5 5,000 0.6 29/07/2013 ABGPJ9502P VINITA SANJAY JOSHI 5 5,000 0.75 8,000 7,995 Total 5 5,000 0.75 18/07/2013 ABHPT5940L KIRAN 4 5,000 0.65 4,800 4,796 NARAYANPRASAD TOSHNIWAL Total 4 5,000 0.65 27/08/2013 ABQPM1056P MEHTA TEJAL PIYUSH 3 5,000 0.95 50 47

16/09/2013 ABQPM1056P MEHTA TEJAL PIYUSH 2 2,500 1.25 47 45

10/10/2013 ABQPM1056P MEHTA TEJAL PIYUSH 3 1,000 1.75 45 42

01/11/2013 ABQPM1056P MEHTA TEJAL PIYUSH 5 2,500 2.35 42 37

26/11/2013 ABQPM1056P MEHTA TEJAL PIYUSH 3 2,500 3.2 37 34

20/12/2013 ABQPM1056P MEHTA TEJAL PIYUSH 2 2,500 4.55 34 32

15/01/2014 ABQPM1056P MEHTA TEJAL PIYUSH 2 15 6.4 32 30

Total 20 16,015 20.45 09/04/2013 ABYPJ9823B SAINIK KUMAR JAIN 2 10,000 0.34 4,000 3,998

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade Total 2 10,000 0.34 11/06/2013 AELPP0173Q SORABH KUMAR 1 5,000 1.1 12,000 11,999 PODDAR Total 1 5,000 1.1 29/05/2013 AELPP0183N RUPESH KUMAR 2 5,000 0.79 28,000 27,998 PODDAR Total 2 5,000 0.79 04/04/2013 AFOPR0263B HEM RAJ RANEJA 2 5,000 0.31 12,000 11,998 23/07/2013 AFOPR0263B HEM RAJ RANEJA 1 5,000 0.65 11,998 11,997 26/07/2013 AFOPR0263B HEM RAJ RANEJA 4 5,000 0.7 11,997 11,993 Total 7 15,000 1.66 20/08/2013 AFZPT5149K TUSHAR ASHOK 1 5,000 0.85 50 49 THAKUR 03/09/2013 AFZPT5149K TUSHAR ASHOK 4 3,000 1.05 49 45 THAKUR 03/10/2013 AFZPT5149K TUSHAR ASHOK 2 2,500 1.55 45 43 THAKUR 15/10/2013 AFZPT5149K TUSHAR ASHOK 3 2,500 1.85 43 40 THAKUR 06/11/2013 AFZPT5149K TUSHAR ASHOK 2 2,500 2.45 40 38 THAKUR 29/11/2013 AFZPT5149K TUSHAR ASHOK 9 2,500 3.4 38 29 THAKUR 19/12/2013 AFZPT5149K TUSHAR ASHOK 4 2,500 4.5 29 25 THAKUR 14/01/2014 AFZPT5149K TUSHAR ASHOK 6 100 6.25 25 19 THAKUR Total 31 20,600 21.9 22/07/2013 AGBPJ8881F SUNAYANA JAIN 3 5,000 0.65 4,000 3,997 Total 3 5,000 0.65 23/08/2013 AHXPM6863F KIRITKUMAR 3 5,000 0.9 50 47 RAMNIKLAL MEHTA 06/09/2013 AHXPM6863F KIRITKUMAR 2 989 1.1 47 45 RAMNIKLAL MEHTA 07/10/2013 AHXPM6863F KIRITKUMAR 3 2,500 1.65 45 42 RAMNIKLAL MEHTA 30/10/2013 AHXPM6863F KIRITKUMAR 6 2,500 2.25 42 36 RAMNIKLAL MEHTA

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 22/11/2013 AHXPM6863F KIRITKUMAR 2 2,500 3.05 36 34 RAMNIKLAL MEHTA 13/12/2013 AHXPM6863F KIRITKUMAR 4 2,500 4.15 34 30 RAMNIKLAL MEHTA 08/01/2014 AHXPM6863F KIRITKUMAR 8 2,500 5.8 30 22 RAMNIKLAL MEHTA Total 28 18,489 18.9 03/04/2013 AIUPR9150N ANAND RANEJA 2 5,000 0.3 12.000 11,998 24/07/2013 AIUPR9150N ANAND RANEJA 1 5,000 0.7 11,998 11,997 Total 3 10,000 1 29/08/2013 AJFPR5740L MANSI MANOJ RANE 2 2,500 1 50 48 05/09/2013 AJFPR5740L MANSI MANOJ RANE 2 2,500 1.1 48 46 12/09/2013 AJFPR5740L MANSI MANOJ RANE 2 2,500 1.2 46 44 25/09/2013 AJFPR5740L MANSI MANOJ RANE 3 2,500 1.4 44 41 21/10/2013 AJFPR5740L MANSI MANOJ RANE 2 2,500 1.95 41 39 12/11/2013 AJFPR5740L MANSI MANOJ RANE 3 2,500 2.65 39 36 05/12/2013 AJFPR5740L MANSI MANOJ RANE 7 2,500 3.65 36 29 31/12/2013 AJFPR5740L MANSI MANOJ RANE 2 2,500 5.15 29 27 Total 23 20,000 18.1 16/08/2013 AKCPS7427B VIKRAM SHAH 2 5,000 0.85 50 48 22/08/2013 AKCPS7427B VIKRAM SHAH 3 5,000 0.9 48 45 20/09/2013 AKCPS7427B VIKRAM SHAH 4 2,500 1.35 45 41 14/10/2013 AKCPS7427B VIKRAM SHAH 6 2,500 1.8 41 35 05/11/2013 AKCPS7427B VIKRAM SHAH 5 2,500 2.4 35 30 28/11/2013 AKCPS7427B VIKRAM SHAH 5 2,500 3.35 30 25 18/12/2013 AKCPS7427B VIKRAM SHAH 6 2,500 4.4 25 19 13/01/2014 AKCPS7427B VIKRAM SHAH 4 10 6.15 19 15 Total 35 22,510 21.2 06/06/2013 AKKPP3508Q PARUL PODDAR 2 5,000 1 30,400 30,398 Total 2 5,000 1 24/12/2013 AMHPM0156A KETAN JUMAKHLAL 5 2,500 4.75 50 45 MEHTA Total 5 2,500 4.75

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 26/08/2013 AMYPD3165F RAKESHKUMAR DIXIT 5 5,000 0.95 50 45 USHA 10/09/2013 AMYPD3165F RAKESHKUMAR DIXIT 5 3,000 1.15 45 40 USHA 28/10/2013 AMYPD3165F RAKESHKUMAR DIXIT 6 2,500 2.15 40 34 USHA 20/11/2013 AMYPD3165F RAKESHKUMAR DIXIT 9 2,500 2.95 34 25 USHA 11/12/2013 AMYPD3165F RAKESHKUMAR DIXIT 5 2,500 3.95 25 20 USHA 06/01/2014 AMYPD3165F RAKESHKUMAR DIXIT 10 2,500 5.55 20 10 USHA Total 40 18,000 16.7 05/07/2013 ANQPS5905F SANDEEP 2 5,000 0.55 3,500 3,498 VISHWANATH SARAF 10/07/2013 ANQPS5905F SANDEEP 1 5,000 0.55 3,498 3,497 VISHWANATH SARAF 15/07/2013 ANQPS5905F SANDEEP 1 5,000 0.6 3,497 3,496 VISHWANATH SARAF Total 4 15,000 1.7 30/07/2013 ANZPT6807C NEHA NARAYAN 3 5,000 0.75 8,000 7,997 TOSHNIWAL Total 3 5,000 0.75 01/10/2013 APPPB5638F MANISH KUMAR 3 2,500 1.55 50 47 BHATI 23/10/2013 APPPB5638F MANISH KUMAR 4 2,500 2.05 47 43 BHATI 13/11/2013 APPPB5638F MANISH KUMAR 2 2,500 2.75 43 41 BHATI 06/12/2013 APPPB5638F MANISH KUMAR 6 2,500 3.75 41 35 BHATI 02/01/2014 APPPB5638F MANISH KUMAR 4 2,500 5.35 35 31 BHATI Total 19 12,500 15.45 04/06/2013 ASZPS1277J SAVITA SONI 2 5,000 0.9 9,600 9,598 Total 2 5,000 0.9 21/08/2013 ATRPM4285D PRIYANKA PRAMOD 4 5,000 0.9 50 46 MHAPSEKAR 04/09/2013 ATRPM4285D PRIYANKA PRAMOD 6 995 1.1 46 40 MHAPSEKAR

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 04/10/2013 ATRPM4285D PRIYANKA PRAMOD 5 2,500 1.6 40 35 MHAPSEKAR 29/10/2013 ATRPM4285D PRIYANKA PRAMOD 5 2,500 2.2 35 30 MHAPSEKAR 21/11/2013 ATRPM4285D PRIYANKA PRAMOD 10 10 3 30 20 MHAPSEKAR 17/12/2013 ATRPM4285D PRIYANKA PRAMOD 5 2,500 4.3 20 15 MHAPSEKAR 10/01/2014 ATRPM4285D PRIYANKA PRAMOD 5 2,500 6 15 10 MHAPSEKAR Total 40 16,005 19.1 01/08/2013 AYOPA2382B NIKUNJ S AGARWAL 12,500 5,000 0.75 Total 12,500 5,000 0.75 02/09/2013 AZAPG1972C TEJAS VASANT GALA 3 1,000 1.05 50 47 19/09/2013 AZAPG1972C TEJAS VASANT GALA 2 2,500 1.3 47 45 11/10/2013 AZAPG1972C TEJAS VASANT GALA 2 2,500 1.75 45 43 03/11/2013 AZAPG1972C TEJAS VASANT GALA 3 500 2.4 43 40 27/11/2013 AZAPG1972C TEJAS VASANT GALA 3 2,500 3.25 40 37 23/12/2013 AZAPG1972C TEJAS VASANT GALA 3 2,500 4.65 37 34 Total 16 11,500 14.4 24/09/2013 BAPPK2160M MUKESH KUMAR 2 2,500 1.4 50 48 18/10/2013 BAPPK2160M MUKESH KUMAR 3 2,500 1.9 48 45 11/11/2013 BAPPK2160M MUKESH KUMAR 5 2,500 2.6 45 40 04/12/2013 BAPPK2160M MUKESH KUMAR 8 25 3.6 40 32 30/12/2013 BAPPK2160M MUKESH KUMAR 3 2,500 5.05 32 29 Total 21 10,025 14.55 08/04/2013 BNNPK9250R KAVITA RANEJA 2 900 0.33 8,000 7,998 25/07/2013 BNNPK9250R KAVITA RANEJA 1 5,000 0.7 7,998 7,997 Total 3 5,900 1.03 18/09/2013 BPXPS8075L ASHISH ISHWARLAL 5 100 1.3 50 45 SHAH 09/10/2013 BPXPS8075L ASHISH ISHWARLAL 6 2,500 1.7 45 39 SHAH 07/11/2013 BPXPS8075L ASHISH ISHWARLAL 9 2,500 2.5 39 30 SHAH

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 12/12/2013 BPXPS8075L ASHISH ISHWARLAL 2 500 4.05 30 28 SHAH 07/01/2014 BPXPS8075L ASHISH ISHWARLAL 3 2,500 5.7 28 25 SHAH Total 25 8,100 15.25 19/08/2013 BQFPS5917N OMPRAKASH RAMDEV 2 2,500 0.85 50 48 SHARMA 28/08/2013 BQFPS5917N OMPRAKASH RAMDEV 2 5,000 0.95 48 46 SHARMA 27/09/2013 BQFPS5917N OMPRAKASH RAMDEV 2 2,500 1.5 44 42 SHARMA 22/10/2013 BQFPS5917N OMPRAKASH RAMDEV 4 200 2 42 38 SHARMA 14/11/2013 BQFPS5917N OMPRAKASH RAMDEV 3 2,500 2.8 38 35 SHARMA 09/12/2013 BQFPS5917N OMPRAKASH RAMDEV 5 2,500 3.8 35 30 SHARMA 01/01/2014 BQFPS5917N OMPRAKASH RAMDEV 6 2,500 5.25 30 24 SHARMA Total 24 17,700 17.15 30/08/2013 CNAPS8962G ASIFATANVEER 4 2,500 1 50 46 MOHAMMADISHAQ SHAIKH 17/09/2013 CNAPS8962G ASIFATANVEER 3 2,500 1.25 46 43 MOHAMMADISHAQ SHAIKH 08/10/2013 CNAPS8962G ASIFATANVEER 5 2,500 1.65 43 38 MOHAMMADISHAQ SHAIKH 31/10/2013 CNAPS8962G ASIFATANVEER 8 2,500 2.3 38 30 MOHAMMADISHAQ SHAIKH 25/11/2013 CNAPS8962G ASIFATANVEER 4 2,500 3.15 30 26 MOHAMMADISHAQ SHAIKH 16/12/2013 CNAPS8962G ASIFATANVEER 3 2,500 4.2 26 23 MOHAMMADISHAQ SHAIKH 09/01/2014 CNAPS8962G ASIFATANVEER 7 25 5.9 23 16 MOHAMMADISHAQ SHAIKH Total 34 15,025 19.45

Trade Date Seller PAN Seller Name Sell Buy LTP No. of Balance order order Contributi shares No of volume volume on (In Rs.) held shares before after trade trade 13/05/2013 AABHA9528A A K ROONGTA HUF 2 2 0 ,000 19,998 10,000 0.56 14/08/2013 AABHA9528A A K ROONGTA HUF 2 5,000 080 Broker (Roongt a) confirm ed that this trade was settled as per Exchang e Auction /Close out Norms

4 Total 15,000 1.36 Grand Total 12,965 408269 278.12

110. Similarly, in respect of the trades carried out by the 14 entities in Patch-2, though the buy orders were available for large quantities (ranging from 28 to 1,000 shares), it has been alleged in the SCN that the 14 entities placed sell orders in small quantities i.e., mostly 5 to 20 shares. For e.g. one entity viz. Ketan Mehta placed sell orders of 10 and 12 shares on two trading days while the buy orders were available for 1,000 shares and 60 shares respectively. In this regard, it would be relevant to place hereunder the details of the sell orders placed by the 14 Noticees and the existing buy orders in the system at the time of such sell orders.

Table-19- Price Manipulation (Sell Side) – Patch 2

No. of Balance shares No of Sell Buy LTP held shares order order Contributio before after Trade Date Seller PAN Seller Name volume volume n (In Rs.) trade trade

MANHARLAL NAROTTAMDAS 27/01/2014 AAKPS3276J SHAH 14 28 0.7 350 336 Total 14 28 0.7 TUSHAR ASHOK 13/02/2014 AFZPT5149K THAKUR 9 500 0.95 190 181 Total 9 500 0.95

KIRITKUMAR RAMNIKLAL 03/02/2014 AHXPM6863F MEHTA 14 500 0.8 220 206 Total 14 500 0.8 MANSI MANOJ 22/01/2014 AJFPR5740L RANE 12 115 0.7 270 258 Total 12 115 0.7 12/02/2014 AKCPS7427B VIKRAM SHAH 15 500 0.9 150 135 Total 15 500 0.9

KETAN JUMAKHLAL 17/01/2014 AMHPM0156A MEHTA 10 1,000 0.65 450 440

KETAN JUMAKHLAL 14/02/2014 AMHPM0156A MEHTA 12 60 0.95 440 428 Total 22 1,060 1.6 RAKESHKUMAR 29/01/2014 AMYPD3165F DIXIT USHA 15 125 0.75 100 85 Total 15 125 0.75 MANISH KUMAR 24/01/2014 APPPB5638F BHATI 12 28 0.7 310 298 Total 12 28 0.7

PRIYANKA PRAMOD 07/02/2014 ATRPM4285D MHAPSEKAR 10 200 0.85 100 90 Total 10 200 0.85

No. of Balance shares No of Sell Buy LTP held shares order order Contributio before after Trade Date Seller PAN Seller Name volume volume n (In Rs.) trade trade TEJAS VASANT 21/01/2014 AZAPG1972C GALA 15 100 0.65 340 325 Total 15 100 0.65 20/01/2014 BAPPK2160M MUKESH KUMAR 20 500 0.65 290 270 Total 20 500 0.65

ASHISH 30/01/2014 BPXPS8075L ISHWARLAL SHAH 5 100 0.75 250 245 Total 5 100 0.75

OMPRAKASH 23/01/2014 BQFPS5917N RAMDEV SHARMA 10 600 0.7 240 230 Total 10 600 0.7

ASIFATANVEER MOHAMMADISHA 06/02/2014 CNAPS8962G Q SHAIKH 15 30 0.85 160 145 Total 15 30 0.85 Grand Total 188 4,386 11.55

111. Accordingly, the SCN has alleged that from the trading pattern of the 41 Noticees, it is seen that the said entities were not acting as genuine sellers; had no bona-fide intention of selling shares; and by releasing very small quantities in each transaction the 41 entities were instrumental in increasing the scrip price.

Profit Booking

112. As already stated, the SCN has also alleged that of the said 41Noticees, 38 Noticees consequent to the manipulation of price, booked substantial profits by selling the shares at inflated prices during the period February 17, 2014 to December 31, 2014. The details with respect to the sale of shares by the 38 Noticees is provided hereunder:

Table - 20

Name of Price Buy Average Sell S N PAN Sell Qty. Sell Value Manipulator Qty. Price 1 Anil Roongta ABBPR3992G - 4,95,980 2,60,61,788.10 52.55 2 Parul Poddar AKKPP3508Q - 3,03,980 1,53,23,564.70 50.41 Rupesh Kumar 3 AELPP0183N - 2,79,980 1,44,86,619.90 51.74 Poddar 4 A K Roongta Huf AABHA9528A - 1,99,980 1,01,92,877.90 50.97 5 Sudha Anil Roongta AAQPR4466F - 1,99,980 1,01,18,688.00 50.6 6 Sorabh Kumar Poddar AELPP0173Q - 1,19,990 66,12,215.00 55.11 7 Anand Raneja AIUPR9150N - 1,19,970 66,19,929.00 55.18 8 Hem Raj Raneja AFOPR0263B - 1,19,930 59,98,879.00 50.02 9 Savita Soni ASZPS1277J - 95,980 48,09,286.80 50.11 Neha Narayan 10 ANZPT6807C - 79,970 42,38,191.00 53 Toshniwal 11 Kavita Raneja BNNPK9250R - 79,970 43,98,583.00 55 12 Sanjay Ambadas Joshi ABGPJ9472Q - 79,950 40,42,087.50 50.56 13 Vinita Sanjay Joshi ABGPJ9502P - 79,950 40,27,837.50 50.38 Vijay Kumar Soni 14 AAGHV5661L - 47,970 24,00,103.00 50.03 (Huf) Kiran Narayanprasad 15 ABHPT5940L - 47,960 24,69,217.50 51.48 Toshniwal 16 Kanta Balkishan Jaju AAJPJ4245M - 39,980 20,08,750.00 50.24 17 Sainik Kumar Jain ABYPJ9823B - 39,980 20,00,070.50 50.03 Megha Ravi 18 AAAPW9319A - 39,970 20,22,482.00 50.6 Wattamwar Ravi B Wattamwar 19 AALHR3103E - 39,970 20,08,692.50 50.26 Huf 20 Sunayana Jain AGBPJ8881F - 39,970 21,95,531.00 54.93 21 Ritu Sandeep Saraf AAHPB4095P - 39,960 22,04,946.50 55.18 Sandeep Vishwanath 22 ANQPS5905F - 34,960 19,28,044.00 55.15 Saraf Sunita Harish 23 AANPT7118D - 970 53,398.50 55.05 Toshniwal Pawankumar Motilal 24 AAAPD9261A - 960 47,760.00 49.75 Darak Ketan Jumakhlal 25 AMHPM0156A - 428 23,540.00 55 Mehta 26 Tejas Vasant Gala AZAPG1972C - 325 17,907.50 55.1 27 Mehta Tejal Piyush ABQPM1056P - 300 16,530.00 55.1 28 Manish Kumar Bhati APPPB5638F - 298 16,390.00 55 29 Mukesh Kumar BAPPK2160M - 270 14,823.00 54.9

Name of Price Buy Average Sell S N PAN Sell Qty. Sell Value Manipulator Qty. Price 30 Ashish Ishwarlal Shah BPXPS8075L - 245 13,475.00 55 Omprakash Ramdev 31 BQFPS5917N - 230 12,661.50 55.05 Shrma Kiritkumar Ramniklal 32 AHXPM6863F - 206 11,360.90 55.15 Mehta 33 Tushar Ashok Thakur AFZPT5149K - 181 9,955.00 55 Asifatanveer 34 Mohammadishaq CNAPS8962G - 145 7,989.50 55.1 Shaikh 35 Vikram Shah AKCPS7427B - 135 7,425.00 55 36 Mansi Manoj Rane AJFPR5740L - 130 7,163.00 55.1 Priyanka Pramod 37 ATRPM4285D - 90 4,729.50 52.55 Mhapsekar Rakeshkumar Dixit 38 AMYPD3165F - 85 4,683.50 55.1 Usha

113. Noticee Nos. 8, 9 and 12 i.e. Anil Satyanarayan Roongta, Sudha Anil Roongta and AK

Roontga HUF have in their reply submitted that during Patch 1, the price of the scrip went up from Rs. 5.50 to Rs. 327.50, registering a price rise of Rs. 321.75 i.e., in a span of 11 months. The net contribution of the Noticees to increase in the LTP was Rs. 3.47 out of the total increase of Rs. 321.75, i.e., 1.08% of the total increase during Patch- 1.

The buyers trading in the scrip had already placed buy orders on the upper circuit limit, the present Noticees could not have sold shares at a lower price even if they so desired, as the scrip had hit the upper circuit. Therefore, merely placing an order at a price different from the LTP cannot amount to a market manipulation. A seller wishes to sell his shares at the highest price and the buyer wishes to purchase at the lowest price.

In this respect, the Noticees have placed reliance on the Hon'ble Securities Appellate

Tribunal Order in the case of Vikas Bengani, wherein SAT had held that for “manipulation collusion between the buyer and the seller is necessary”. The present Noticees are in no manner connected or related either by blood or otherwise to any other of the entities in the SCN. Further, the Noticees have stated that selling shares in smaller quantities is a regular trading strategy employed in the securities market. Furthermore, buyers who purchased either from the market, through RRSPL or were allotted shares under preferential allotment also sold shares at higher prices but they have not been asked to show cause, while the Noticees have been.

114. It is evident from the replies of other Noticees i.e. Noticee Nos. 10, 11, 13 to 16,18 to 23, 27 to 28, 31 to 33, 35 to 46, 49 and 51 to 53, as summarised in paragraphs 21 to 51 of this Order, that the grounds put forth by them are similar to the arguments put forth by Noticee Nos. 8, 9 and 12. Accordingly, the same are not being reiterated here.

115. As already stated, trading in the scrip of Mishka was suspended from January 07, 2002 to May 09, 2012 on account of non-payment of listing fees. The suspension of trading in the securities of the scrip was revoked w.e.f. May 10, 2012. Consequent to such revocation of suspension, trading in the scrip ensued. Thereafter, a corporate announcement was made by Mishka on January 28, 2013 to BSE, that the company had decided to issue bonus shares in the ratio of 7:1, i.e. 7 (Seven) new equity shares of the face value of Rs.10/- credited as fully paid up for every 1 (One) existing equity shares of the face value of Rs.10/- held by its members. Consequent to the said decision to issue bonus shares, a corporate announcement was made by Mishka on February 07,

2013 to the BSE, informing the BSE that its Board of Directors had accorded “the allotment of 90,41,900 Equity Shares of Rs.10/- each aggregating Rs.9,04,19,000/- as fully paid

Bonus Shares, to the shareholders of the Company whose names appears in the Register of Members as on record date i.e. February 06, 2013”. Accordingly, by way of BSE Notice No.

20130218-3 dated February 18, 2013, the 90,41,900 bonus equity shares issued by Mishka were listed and permitted to trade with effect from February 19, 2013.

Subsequent to the issuance of bonus equity shares by Mishka, by way of corporate announcement to BSE dated December 30, 2013, the Company announced its decision to split one share of face value Rs.10 into ten shares of face value Rs.1 each.

116. It is reiterated that the 41 Noticees came to acquire the shares of Mishka in off-market transactions from/through RRSPL. These shares had been acquired by RRSPL from the promoters of the Company in similar off-market transactions. These shares of Mishka acquired by the 41 Noticees were subsequently sold by them in the market.

117. In this background and based on the price volume movement, the investigation period was divided into four patches, namely Patch-1 (14-Feb-13 to 15-Jan-14), Patch-2 (16-

Jan-14 to14-Feb-14), Patch- 3 (15-Feb-14 to 10-Sep-14) and Patch-4 (11-Sep-14 to 31-Dec-14).

118. It is gathered from the trades carried out by the 41 Noticees in Patch-1, and 14 entities out of the said 41 entities in Patch-2 had adopted the strategy of placing multiple sell orders in miniscule number of shares over a number of days, so as to sustain the high trading price of the scrip in the market. It is true that there is no one-to-one relationship between the parties to the trade or an identifiable connection between the buyers so as to treat them as a group. However, the seller group identification is strong from the angle of procurement from a common source (i.e. the Roongtas or RRSPL ) and from the post acquisition sell strategy uniformly adopted by them, as seen from the Tables above. It is reiterated that the sellers now were the buyers earlier and the current group of buyers placing orders on the market may not necessarily be aware of the game played behind the screen. It is a matter of fact that the market in the scrip was totally skewed by the sellers. Further the sellers created a market for the scrip and consciously endeavoured to sustain the market up. It is in this background that the present examination of the sell orders involving a small number of shares by the said 41 entities is being carried out.

119. In this respect, the rationale put forth by the said Noticees in placing such a small number of sell orders involving a small number of shares is that this was done to gauge or assess the demand for the shares of Mishka in the market, and it was part of their trading strategy. This rationale, does not stand in view of the said Noticees’ own assertion that there were pre-existing buy orders above LTP, before they placed the sell orders. Since, there were pre-existing buys orders, the said Noticees by seeing the buy orders could have gauged the demand in the market. There was really no need to actually sell the shares to gauge demand. Therefore, this rationale that the sell orders involving a small number of shares placed by the said Noticees, in my view, is not convincing at all. It is stated that all the 41 entities had received shares either from RRSPL or through RRSPL. The entities had also enclosed the same copies of the advertisement, and the said copies contained four inverted commas and same handwritten phrase on it. Thus, the group of 41 entities was working together with a common objective of manipulating the price of the scrip.

120. Further, a perusal of Table 18 of this Order, which relates to Patch-1 shows that sell orders for 12,965 shares were placed by the 41 Noticees in response to a total buy order quantity of 4,08, 269 shares, which were in the system. Similarly, a perusal of Table 19 of this Order, which relates to Patch-2, shows that sell orders for 188 shares were placed by 14 out of the 41 Noticees in response to a total buy order quantity of 4, 386 shares, which were in the system. The above mentioned tables also show that the 41

Noticees held a considerable number of shares, and as such had control over the supply of the shares of Mishka in the market. Since, the said Noticees controlled the supply of shares in the market, they were successful in pushing the price of the scrip by curtailing the supply of shares in the market. Consequently, the same set of Noticees (38 out of the 41), sold the shares at an average sell price of anywhere between Rs. 50 to 55 to book profits. It cannot be a mere coincidence that the same set of people who sold small number of shares, subsequently also happened to sell the shares at an inflated price. Thus, from the above circumstances, the only reasonable conclusion that can be drawn is that the said Noticees, with the common intent of artificially inflating the price, sold shares in small quantities, and consequent to such appreciation, off-loaded a substantial number of shares when they believed that the price of the share was high enough for them to book profits.

121. Also, it has been stated by the said Noticees that they had bought the shares, which were ultimately sold by them, for the purpose of investment. However, if one looks at the Company, it would be evident that the Company did not present a very lucrative investment opportunity. The trading in the scrip of Mishka was suspended from January 07, 2002 to May 09, 2012. In this respect it is stated that as on September 30,

2011, Mishka had only 7 shareholders (5 under promoters and 2 under public shareholder categories). Thereafter, the aforesaid 7 shareholders transferred a total of 4,96,000 shares during the period from December 11, 2011 to February 05,

2013. It is in this period that most of the above mentioned Noticees also bought shares.

Also, from the Annual Reports of Mishka for FY 2011-12 and FY 2012-2013, it was observed that it had incurred a loss of Rs. 12 Lakh during FY 2011-12 and earned a profit of ₹12 Lakh during FY 2012-13. Further, from the Annual Report of Mishka for FY 2012-2013, it is observed that for FY ended 2012 the earning per share (“EPS”) of Mishka was Rs. -2.4 and for the FY ended March 31, 2013, EPS was Rs. 0.12. It is evident that there was hardly any financial sense to ‘invest’ in the shares of Mishka. Therefore, I find the assertion on the part of the said Noticees that they had bought the shares, which were ultimately sold by them, for the purpose of investment is not convincing enough.

122. I note that that the said Noticees have relied on the order of the Hon’ble SAT in the matter of Vikas Ganeshmal Bengani vs Whole Time Member, SEBI (Appeal No. 225 of 2009 decided on February 25, 2010) and other cases to claim that in the absence of any finding of collusion between the buyer and the seller the charge of contributing to the LTP cannot be sustained against them. It must be appreciated that over the course of many years, since the aforesaid decision, the Hon’ble SAT has evolved nuanced principles with respect to a charge of unilateral price manipulation, as would be evident from a reading of the various orders passed thereafter. The Hon’ble SAT has observed that a charge of unilateral price manipulation, without establishing collusion between buyer and seller, could attract the provisions of PFUTP, 2003, if it is established that a) the evidence available on record shows that the trades were placed when sell orders for a lower price was available in the system; or b) mala fide intention can be established through an analysis of the trade and order logs; or c) cases where no justifiable reason have been provided for entering into such transactions in terms of normal rational expectations of a seller.

In this regard, specific mention is made of the order passed by the Hon’ble SAT in Mrs Kalpana Dharmesh Chheda v. SEBI(Appeal No. 454 of 2019 decided on February 25, 2020). In the said matter, an appeal had been filed challenging the Order of SEBI AO imposing penalty on the Appellants for executing trades, mostly sell orders, in very small volumes at prices above the Last Traded Price (LTP). In this regard, the Hon’ble SAT has observed that “We do not find much merit in the submissions made by the learned counsel for the appellants though generally it can be stated that selling at a price higher than the LTP particularly when buy orders are available in the system cannot be considered as manipulative in itself. However, looking at the pattern of trading done by the appellants and the fact that the appellants have derived considerable financial benefit through that particular scheme or nature of trading we are of the view that the trading pattern adopted by the appellants is of a manipulative and unfair nature and would squarely fall within the ambit of the PFUTP Regulations. The pattern of trade clearly establishes this as it is on 49 occasions that the appellants sold 1 to 5 shares, mostly one share, when in fact the buy orders available in the system was much higher.

This behavior cannot be justified in terms of normal rational expectations of a seller. It is on record that the appellants were among the top two net sellers during the relevant period. Therefore, when the appellants were holding a large number of shares (Appellant No. 1 – 15045 shares and Appellant No. 2 – 1009 shares), their selling miniscule quantity of one share each on more than four dozen occasions is nothing but a strategy of manipulation and unfairly benefiting by off-loading the entire shareholding after raising the price to considerable levels.” Thus, the submission of the Noticees that for a charge of market manipulation to be made against the sellers, it is necessary to place the same charge against the buyers is not sustainable, in all circumstances. It can change from the facts and circumstances of one case to the other.

123. Also, reference is drawn to the Hon’ble SAT’s Order dated November 05, 2019 in the matter of Jayaprakash Bohra V. SEBI in Appeal No. 162 of 2019. In the said matter, an appeal had been filed challenging the Order of SEBI restraining the Appellant, from dealing in securities for a stipulated period. In the matter, the non-independent directors of a company, Gromo Trade & Consultancy Ltd, in connivance with a group of entities known as Kamalakshi Group indulged in price manipulation and created false/ misleading appearance of trading in the scrip at inflated prices; even though there was no perceptible change in the fundamentals of the company which would support a rise in the price of the scrip. In this regard, the Hon’ble SAT has observed that “ The submission that all the holdings of the appellant are in normal course of business has no merit as the entire issue in the matter is not normal course of business. An unknown company suspended from trading for long; off market buying of 1,050 shares of the said company which constitutes more than 2% of its share capital and which is in the name of an unknown person (Kushal Jain) on the recommendation of a person from the native place of the appellant with no prior connection etc. can be treated as only a fiction rather than normal business. Coupled with the finding that the appellant had other transactions off-market with Gromo ….is sufficient evidence to prove the connection between Gromo, the appellant and entities in the Kamalakshi Group, many of whom are inter connected in the matter as explained in the said table. Moreover, out of 1,050 shares of Gromo obtained off-market in an inexplicable way by the appellant more than half of it was sold in small tranches; most of the time placing sell order at far away prices than LTP. The said trading pattern and the other connections as explained above is sufficient enough to prove that the appellant was part of the group that created the artifice/ scheme and therefore finding in the impugned order that the appellant has violated the stated provisions of the PFUTP Regulations cannot be faulted.”

124. In this regard, the facts as brought out in the present matter reveal that a. the trading of the shares of Mishka were suspended from January 07, 2002 to May 09, 2012, and the trading in the securities of the scrip was revoked w.e.f. May 10, 2012;

b. the 41 Noticees purchased the shares from/through RRSPL in off-market transactions;

c. certain directors, namely Anand Gupta and Vijay Kumar Jain left the board on March, 30, 2013, and new directors were inducted;

d. the Company issued bonus shares in the ratio of 7:1 i.e. seven bonus shares for every one share of the company on February 06, 2013;

e. the 41 Noticees sold the shares in small quantities pushing up the price;

f. the share price of the Company saw a steep rise moving from Rs.5.50 on February 14, 2013 to Rs.327.25 on January 15, 2014;

g. the Company sub-divided existing equity share of Rs.10 each to 10 equity shares of Rs.1 each on January 16, 2014; and h. once the price rose, 38 out of the 41 Noticees sold the shares and booked profits during the period February 17, 2014 to December 31, 2014.

Thus, the facts in the present matter mirror the facts adjudicated upon by the Hon’ble SAT in Jayaprakash Bohra V. SEBI, wherein the Hon’ble SAT in its own words has observed that, “ An unknown company suspended from trading for long; off-market buying of 1,050 shares of the said company which constitutes more than 2% of its share capital and which is in the name of an unknown person (Kushal Jain) on the recommendation of a person from the native place of the appellant with no prior connection etc. can be treated as only a fiction rather than normal business. Coupled with the finding that the appellant had other transactions off-market with Gromo as given in Table 2 page 13-14 of the impugned order is sufficient evidence to prove the connection between Gromo, the appellant and entities in the Kamalakshi Group, many of whom are inter connected in the matter as explained in the said table. Moreover, out of 1,050 shares of Gromo obtained off-market in an inexplicable way by the appellant more than half of it was sold in small tranches; most of the time placing sell order at far away prices than LTP. The said trading pattern and the other connections as explained above is sufficient enough to prove that the appellant was part of the group that created the artifice/scheme and therefore finding in the impugned order that the appellant has violated the stated provisions of the PFUTP Regulations cannot be faulted.” The Company, Mishka lying obscure as a suspended company for about 10 years is resurrected and trading in the Company is restarted with effect from May 10, 2012. The Promoters/Shareholders of the Company sell their shares to/through RRSPL in off –market transactions, which in turn gets sold to other entities including the 41 Noticees. Directors of the Company, appointed prior to the lifting of suspension leave the Board and new directors are inducted. Also, the Company takes two important corporate actions: bonus issue of shares and stock split. The 41 Noticees start to sell the shares in small quantities, and then sell the shares at inflated prices to book profits.

125. In light of the above, I am convinced that the trades carried out by the 41 Noticees in Patch-1, and 14 Noticees out of the said 41 entities in Patch-2 was with the intent of manipulating the price of the scrip, with the objective of pushing the price upward so as to be able to off-load the same at an inflated price and book profits. I therefore find that the Noticees have violated the provisions of Regulation 3(a), (b), (c), (d) and Regulation 4(1), 4(2) (a), and 4(2) (e) of the SEBI PFUTP Regulations, 2003. By way of email dated November 09, 2020, it has been informed by Kirit Shah, son of the Noticee, that Manharlal N Shah, Noticee No. 59 has passed away. The proceedings initiated against Noticee No. 59 thus stands abated.

126. In conclusion, it is stated that the Company along with its directors namely, Ankit Om Prakash Garodia (Noticee No. 2 ), Jugalkishore Sharma (Noticee No. 3 ), Anand Gupta (Noticee No. 6 ) and Vijay Kumar Jain (Noticee No. 7) by placing misleading objects of the preferential allotment before the shareholders and misutilising the proceeds of preferential allotment have violated Section 12A (a), (b) and (c) of SEBI Act, 1992 and Regulations 3 (a), (b), (c), (d), 4(1), and 4(2)(f) of SEBI (PFUTP) Regulations, 2003. Similarly, Noticee Nos. 8 and 9 by buying shares from the promoter entities as the principal and not as brokers, as has been claimed by them, and issuing an advertisement seeking purchasers for the shares of Mishka so bought, have devised a scheme for manipulating the price of the scrip of Mishka and as such have violated provisions of Regulations 3(a)(b)(c)(d) and 4(1) SEBI (PFUTP) Regulations, 2003. Furthermore, I find that the trades carried out by the 41 entities in Patch-1 (February 14, 2013, to January 15, 2014), and 14 entities out of the said 41 entities in Patch-2 (January 16, 2014 to February 14, 2014) was with the intent of manipulating the price of the subject shares so as to be able to sell the shares at substantial profit during February 17, 2014 to December 31, 2014 i.e. Patch-3 and Patch 4, thereby violating the provisions of Regulation 3(a), (b), (c), (d) and Regulation 4(1), 4(2) (a), and 4(2) (e) of the SEBI PFUTP Regulations, 2003.

127. It is learnt that Vijay Kumar Jain, Noticee No 7 has passed away on October 18, 2018 in Delhi. Similarly, it is learnt that Manharlal N Shah, Noticee No. 59 has passed away on April 13, 2016 in Mumbai. Thus, the proceedings stand abated against Noticee No 7 and Noticee No. 59.

128. Directions —

128.1. I, in exercise of powers conferred upon me under sections 11(1), 11 (4) and 11B the Securities and Exchange Board of India Act, 1992 hereby pass the following directions:

128.1.1.The directions against Amit Kumar Vasishtha (Noticee No. 4) and Rameshwar Manohar Wagh (Noticee No. 5) in the Interim Order dated April 17, 2015 is revoked with immediate effect. The SCN dated December 12, 2017 stands disposed accordingly, without any directions.

128.1.2.The Noticees, as listed in the table below, shall be restrained from accessing the securities market, and further prohibited from buying, selling or otherwise dealing in securities, directly or indirectly, and associating with the securities market in any manner:

Table -21 Whether Period of Noticee Noticee Debarred by Debarment (in No. Interim Order years)

Dated April 17, 2015

Mishka Finance and Trading Till the date of this 1 Limited Yes Order

10 Pawan Darak No 3

11 Megha Ravi Wattamwar No 3

Till the date of this A K Roongta HUF 12 Yes Order

13 Vijay Kumar Soni Huf No 3

14 Ritu S Saraf No 3

15 Kanta Balkishan Jaju No 3

16 Ravi B Wattamwar Huf No 3

18 Sunita Toshniwal No 3

19 Sanjay Ambadas Joshi No 3

20 Vinita Sanjay Joshi No 3

21 Kiran Narayanprasad Toshniwal No 3

22 Tejal Piyush Mehta No 3

23 Sainik Kumar Jain No 3

27 Sorabh Kumar Poddar No 3

Till the date of this Rupesh Poddar 28 Yes Order

31 Hemraj Raneja No 3

32 Tushar Ashok Thakur No 3

33 Sunayana Jain No 3

35 Kiritkumar Ramniklal Mehta No 3

36 Anand Raneja No 3

37 Mansi Manoj Rane No 3

38 Vikram Navinchanra Shah No 3

Till the date of this Parul Poddar 39 Yes Order

40 Ketan Jumakhlal Mehta No 3

41 Usha Rakeshkumar Dixit No 3

42 Sandeep V Saraf No 3

43 Neha Narayan Toshniwal No 3

44 Manish Kumar Bhati No 3

45 Savita Soni No 3

46 Priyanka Pramod Mhapsekar No 3

49 Tejas Gala No 3

50 Mukesh Kumar No 3

51 Kavita Raneja No 3

52 Ashish Ishwarlal Shah No 3

53 Omprakash Sharma No 3

57 Asifatanveer M Shaikh No 3

58 Chandravati M Shah No 3

60 Nikunj S Agarwal No 3

128.1.3.The Noticees, as listed in the table below, shall be restrained from accessing the securities market, and further prohibited from buying, selling or otherwise dealing in securities, directly or indirectly, and associating with the securities market in any manner; and shall also be restrained from holding any position of Director or key managerial personnel in any listed company or any intermediary registered with SEBI, or associating themselves with any listed public company or a public company which intends to raise money from the public or any intermediary registered with SEBI for the respective periods as provided in the table below:

Table-22

Whether Debarred by Period of Noticee Noticee Interim Order Debarment (in No. Dated April 17, years) 2015

Till the date of this Ankit Garodia 2 Yes Order

Till the date of this Jugalkishore Pralhadrai Sharma 3 Yes Order

6 Anand Gupta No 4

Till the date of this Anil Satyanarayan Roongta 8 Yes Order

9 Sudha Anil Roongta No 4

128.1.4.It is clarified that while calculating the period of debarment as directed above, the period already undergone by the respective Noticees, in pursuance of the Interim Order, shall be taken into consideration and the same shall be set-off to give effect to the directions of restraint and prohibition as directed above.

128.1.5.The Noticees as mentioned in sub-paragraph 128.1.2 and 128.1.3 may liquidate their existing holdings, except the shares of Mishka, if any, during the said debarment/restraint periods.

128.2. The above directions shall come into force with immediate effect.

128.3. A copy of this order shall be served upon the Noticees immediately. A copy shall be served on the recognised Stock Exchanges and the Depositories for necessary action.

Date: December 02, 2020 G. MAHALINGAM

Place: Mumbai WHOLE TIME MEMBER

SECURITIES AND EXCHANGE BOARD OF INDIA