Appeal No. 173 of 2012. Case: Alfa Fiscal Services Private Limited a Company Registered Under the Companies Act, 1956 and Having Its Registered Office At 437, Start Chamber, Harihar Chowk, Rajkot - 360001, Hardik Bagadia Director of Appellant No. 1, Having His Address At 437, Start Chamber, Harihar Chowk, Rajkot - 360001 and Bhavesh Sheth Director of Appellant No. 1, Having His Address At 437, Start Chamber, Harihar Chowk, Rajkot - 360001 Vs Securities and Exchange Board of India SEBI Bhavan, Plot No. C-4A, 'G' Block, Bandra Kurla Complex, Bandra (East), Mumbai - 400051. Securities and Exchange Board of India
| Case Number | Appeal No. 173 of 2012 |
| Judges | P.K. Malhotra, Member and Presiding Officer (Offg.) and S.S.N. Moorthy, Member |
| Issue | Capital Market |
| Judgement Date | August 29, 2012 |
| Court | Securities and Exchange Board of India |
Judgment:
P. K. Malhotra, Member & Presiding Officer (Offg.)
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PG Electroplast Limited, a company registered under the Companies Act, 1956 came out with an initial public offer (IPO) in September, 2011. The scrip of the company was listed on the National Stock Exchange of India Limited and Bombay Stock Exchange on September 26, 2011. Securities and Exchange Board of India carried out investigations into the alleged irregularities in the IPO and trading of the scrip of the company. During the course of investigations, the Board prima facie came to the conclusion that the appellants, which is an investment company and carrying on the business of dealing in securities, and its directors have traded in the scrip of the company and it placed buy order at a price higher than the available sell order price in the system with the intention to increase the price of the scrip. Pending further investigations, the Board passed an Ex-parte ad-interim order on December 28, 2011 against various entities including the appellants. By the impugned order, the appellants were prohibited from buying, selling or dealing in the securities market in any manner, whatsoever, till further directions. The said ex-parte ad-interim order is also a show-cause notice to the concerned entities, including the appellants, asking them to file objection, if any, against the said order.
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The grievance of the appellants is that they filed their reply to the said showcause notice on January 16, 2012 denying the allegations. They also attended a personal hearing on May 3, 2012 and sent another letter dated July 24, 2012 requesting the Board to vacate the said ex-parte ad-interim order. However, the Board has not taken any action so far and under the said ex-parte ad-interim order, the appellants are being denied the right to trade in the market. According to the appellants, they have amply demonstrated that there is no merit in the allegations and the directions against the appellants are not required and the respondent's action of not having passed a final order pursuant to the submissions of the appellants despite lapse of more than 7 months, is a major irregularity on the part of the respondent and call for impugned order to be set...
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