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AMICUS AI
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Attorney(S)
  • For the Noticee: 1. Shri Anil Seth, Director, Compuaction Securities Private Ltd.
  • 2. Shri Rakesh Gulati, Compuaction Securities Private Ltd.
  • For SEBI 1. Mrs. Barnali Mukherjee, DGM.
  • 2. Shri Deepesh M.U Manager.
  • 3. Shri Mohamed Rahaz. P.M Legal Officer
Judges
  • V.K Chopra, Whole Time Member
Acts
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Attorney(S)
  • For the Noticee: 1. Shri Anil Seth, Director, Compuaction Securities Private Ltd.
  • 2. Shri Rakesh Gulati, Compuaction Securities Private Ltd.
  • For SEBI 1. Mrs. Barnali Mukherjee, DGM.
  • 2. Shri Deepesh M.U Manager.
  • 3. Shri Mohamed Rahaz. P.M Legal Officer
Judges
  • V.K Chopra, Whole Time Member
Acts
See more information ...
Smart Summary

Factual and Procedural Background

SEBI initiated an investigation into alleged price manipulation in the trading of Sun Infoways Limited (SIL) shares between February and December 2000. The investigation revealed a significant rise in the share price from Rs. 10 to Rs. 697 over the period, allegedly orchestrated through multiple entities including the Noticee, Compuaction Securities Private Ltd., acting as a sub-broker of IKM Investment Services Ltd. The Noticee held registrations with multiple stock exchanges.

The investigation uncovered that the auditor of SIL, Shri Dilip Nabera, and his associate Shri Kuldip Handoo were behind manipulative trades, with the Noticee executing trades for clients connected to these individuals, creating an artificial market in the SIL shares.

Following the investigation report, SEBI appointed an Enquiry Officer to examine violations by the Noticee under the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995 (PFUTP Regulations) and SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992.

The Enquiry Officer issued a show cause notice to the Noticee in December 2004 to explain why enquiry proceedings should not be initiated for alleged violations. The Noticee submitted written replies denying knowledge of manipulative trades and asserting proper conduct as a sub-broker, but did not attend personal hearings.

After enquiry, the Enquiry Officer recommended suspension of the Noticee’s certificate of registration for four months. A further show cause notice was issued in April 2006, to which the Noticee replied denying knowledge of manipulation and placing responsibility on the main broker. A personal hearing was conducted in March 2007.

Legal Issues Presented

  1. Whether the Noticee, Compuaction Securities Private Ltd., engaged in manipulative and fraudulent trading practices in violation of Regulation 4(a) and 4(b) of the PFUTP Regulations?
  2. Whether the Noticee failed to exercise proper skill, care, and diligence as required under the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992?
  3. Whether the penalty of suspension of the Noticee’s certificate of registration is justified under the SEBI Act and relevant regulations?

Arguments of the Parties

Noticee's Arguments

  • The Noticee acted with proper skill and diligence in the normal course of business as a sub-broker of IKM.
  • They had no knowledge of artificial trading in the SIL scrip, as their clients traded in multiple scrips.
  • All trading activities were supervised by the main broker, IKM.
  • The Noticee’s directors and staff did not engage in trading themselves; their income was limited to brokerage fees.
  • The responsibility for identifying and preventing manipulative trades lies with the main broker and the stock exchange, not the sub-broker.
  • The Noticee fully cooperated with SEBI’s investigations and provided all demanded documents.
  • They requested that proceedings against them be dropped, denying any involvement in manipulative trading.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court examined the investigation and enquiry reports, along with the Noticee’s submissions and hearing records. It found that after the new promoter group acquired a majority stake in SIL, there was a large volume of structured and matched trades at successively higher prices, primarily executed through entities connected with the Noticee’s clients.

The court noted the pattern of trades involving the Noticee and other brokers where buy and sell orders matched in quantity and price, often reversed on the same day, indicating no genuine change in beneficial ownership. This pattern created a misleading appearance of trading activity, artificially inflating the market price and volume of SIL shares.

The Noticee’s contention that responsibility lies with the main broker was rejected. As a registered sub-broker, the Noticee was bound by applicable regulations and codes of conduct, which they failed to uphold by participating in structured and manipulative trades. The frequency and consistency of matched trades showed a predetermined arrangement rather than coincidence.

The court emphasized that the stock market’s screen-based trading system is designed to ensure fair and transparent transactions, but this mechanism can still be misused for structured transactions. The Noticee facilitated manipulative trades on the exchange platform as per prior understanding with clients.

The Noticee’s failure to exercise due skill, care, diligence, and to take corrective action despite clear indications of manipulation, undermined market integrity and violated the regulatory code of conduct for sub-brokers.

Accordingly, the violations of Regulation 4(a) and 4(b) of PFUTP Regulations and clauses of the code of conduct under Regulation 15(1)(b) of SEBI (Stock Brokers and Sub-brokers) Regulations, 1992 were established.

Holding and Implications

The court imposed a penalty of suspension of the certificate of registration of Compuaction Securities Private Ltd. as a sub-broker for a period of four months, in line with the recommendation of the Enquiry Officer.

This order will come into force after 21 days from the date of the order. The decision directly affects the Noticee by restricting its ability to operate as a sub-broker for the suspension period. No new precedent was set beyond the application of existing regulatory provisions to the facts of this case.

Show full summary ...

    Compuaction Securities Private Ltd., In Re (Failure To Exercise Due Diligence)

    1. SEBI initiated investigations into the alleged price manipulation in the trading of Sun Infoways Limited shares (hereinafter referred to as “the scrip”) between February 2000 and December 2000. On analyzing the price/volume data of the scrip during the investigation period, it was observed that on February 9, 2000, only one trade for 100 shares was executed in the scrip at a price of Rs. 10/- per share for Rs. 1000/-. However, thereafter the price of the scrip, continued to rise and reached at a highest level of Rs. 697/- on September 11, 2000 with volume of 24,800 shares. This was allegedly effected through large number of entities, associated with the new promoters, directors and associates of SIL as well as few brokers and sub-brokers including Compuaction Securities Private Ltd. (hereinafter referred to as ‘Noticee’) acting as sub-broker of IKM Investment Services Ltd. (hereinafter referred to as “IKM”) from May 16, 2000 onwards with SEBI Registration No. 1NS050579239 and INS010579238. It is further seen that Noticee hold broker registrations in Calcutta Stock Exchange (INB 030794433), Delhi Stock Exchange (INB050794435), National Stock Exchange (INB230794438) and OTC Excahnge of India (INB 200794434).

    2. Investigations inter alia revealed that Shri Dilip Nabera who was the auditor of SIL and his friend Shri Kuldip Handoo were behind the entire manipulative trades in SIL scrip. The Noticee had executed manipulative trades on behalf of the clients who were connected to Shri Kuldip Handoo and Shri Dilip Nabera and created artificial market in the scrip.

    3. After considering the Investigation Report, SEBI appointed an Enquiry Officer to enquire into the violations allegedly committed by the Noticee under SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995, (hereinafter referred to in short as “PFUTP Regulations”) and SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 (hereinafter referred to in short as “Stock brokers Regulations”).

    4. A show cause notice dated December 20, 2004 was issued by the Enquiry Officer to the Noticee under Regulation 6(1) of SEBI (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (hereinafter referred to as “the Enquiry Regulations”) to show cause, as to why enquiry proceedings should not be initiated against the Noticee for the violations of Regulation 4(a) and 4(b) of PFUTP Regulations and code of conduct as per schedule II read with Regulation 15 of Stock brokers Regulations.

    5. The Enquiry Officer had given opportunities of personal hearing to the Noticee who did not avail the same. The Noticee however filed written submissions vide its two letters dated March 10, 2006 wherein the Noticee inter alia submitted that it had acted and exercised proper skill and diligence in the normal course of business in its dealings as a sub-broker of IKM. It had no knowledge of artificial trading in the scrip since its clients were trading in many scrips besides SIL. All its trading related matters as a sub broker had been continuously supervised by IKM. It had provided all the documents as demanded by SEBI and had given full co-operation in the case. These details required specialized skills and large funding and should be managed by the main broker and exchanges equipped with high tech software, computers and MBA level staff members. It's directors or the staff hardly did any trading and their income was from brokerage and not from trading. It had no financial interest in the case except brokerage charged from the clients, which rates are very competitive. They were not aware of any artificial trading in the scrip.

    6. The Enquiry Officer, after conducting enquiry in accordance with the provisions of the Enquiry Regulations submitted a report dated April 13, 2006. The Enquiry Officer in her report recommended that the certificate of registration granted to the Noticee be suspended for a period of four months.

    7. Pursuant to the receipt of the Enquiry Report, Show Cause Notice dated April 26, 2006 was issued to the Noticee along with copy of the Enquiry Report advising it to show cause as to why the action, as recommended by the Enquiry Officer should not be imposed on it.

    8. The Noticee filed reply vide letter dated May 10, 2006 stating that the whole plan was seen to be devised by the traders and BSE could have identified and prevented such trades. It has submitted that they were not having any knowledge of the matched trades. It further added that the sub brokers like them are actually working for the main brokers and as such the responsibility lies with the broker who could have identified the manipulation and could have prevented such trades. They went on to state that there was no reason for them to suspect the trades and none of their clients were related with them. They further stated that they had fully co-operated with the Investigations and requested to drop the entire proceedings against them.

    9. An opportunity of personal hearing was given to the Noticee before me at SEBI's Head office at Mumbai on March 20, 2007. Shri Anil Sethi and Shri Rakesh Gulati of the Noticee attended the hearing and reiterated the submissions they have already made in the enquiry proceedings as well as in the reply to the show cause notice.

    10. I have carefully examined the Enquiry Report, Show Cause Notices, Replies of the Noticee and submissions made at the time of hearing.

    11. I find that the new promoter group purchased 98% of the capital of the company in January 2000 for a total consideration of Rs. 98,34,659/-. After acquiring the shares the new promoters with the help of related entities entered into large volume of trading in the shares as purchasers as well as sellers. Some of the related entities viz. Shri Ashok Kumar Chaudhary and his brother Shri Ramesh Kumar Choudhary, Shri S.K Marwah and Shri Rajendra Rai executed large number of structured/matched trades at successively higher prices.

    12. I observe that consequent to a change in shareholding of SIL during January 2000, large scale volumes accompanied with price hike were witnessed in the trading of SIL scrip. The price and volume in the SIL scrip as on February 9, 2000 were only Rs. 10 and 100 shares respectively which peaked to the highest level of Rs. 697/- with a volume of 24,800 shares as on September 11, 2000. The details of price and volume in the scrip for the period under investigation are given below:

    DATE OPEN HIGH LOW CLOSE NO. OF TRADES QTY. TRADED VALUE 09.02.2000 10 1 100 1000 10.02.2000 10 1 100 1000 11.02.2000 11 12.4 10 5 1000 11580 14.02.2000 12.45 10.5 11.1 5 700 8035 15.02.2000 11.95 1 100 1195 16.02.2000 12.5 12.85 4 400 5105 17.02.2000 12.5 5 500 6250 18.02.2000 13.45 1 100 1345 22.02.2000 14.5 2 200 2900 23.02.2000 15.65 1 100 1565 24.02.2000 16.85 2 600 10110 25.02.2000 18.15 3 600 10890 28.02.2000 18.85 1 100 1885 01.03.2000 19.55 1 200 3910 02.03.2000 20.3 2 300 6090 03.03.2000 21.1 1 100 2110 06.03.2000 21.9 3 300 6570 07.03.2000 22.75 6 1000 22750 08.03.2000 23.65 1 100 2365 09.03.2000 24.55 5 1000 24550 10.03.2000 25.5 4 800 20400 13.03.2000 26.5 3 500 13250 14.03.2000 27.55 2 300 8265 15.03.2000 28.6 2 300 8580 16.03.2000 29.7 4 700 20790 21.03.2000 30.85 2 200 6170 22.03.2000 32.05 1 200 6410 23.03.2000 33.3 1 100 3330 24.03.2000 34.6 3 1500 51900 27.03.2000 35.95 1 100 3595 28.03.2000 37.35 1 100 3735 29.03.2000 38.8 1 100 3880 30.03.2000 40.3 5 600 24180 31.03.2000 41.9 16 3600 150840 03.04.2000 43.55 5 2700 117585 04.04.2000 45.25 41.85 42.6 97 43100 1861105 05.04.2000 41.1 40.9 44.25 34 17600 729930 06.04.2000 46 31 6600 303600 07.04.2000 47.8 13 1900 90820 10.04.2000 49.7 4 2000 99400 11.04.2000 51.65 7 1500 77475 12.04.2000 53.7 4 1200 64440 13.04.2000 55.8 55 55.8 21 5600 312295 17.04.2000 58 56 58 9 5400 311200 18.04.2000 60.3 1 500 30150 19.04.2000 62.7 6 1500 94050 20.04.2000 65.15 18 4000 260600 24.04.2000 67.7 62.55 67.7 38 17700 1171150 25.04.2000 70.35 8 1800 126630 26.04.2000 73.15 11 1200 87780 27.04.2000 76.05 1 100 7605 28.04.2000 79.05] 15 6100 482205 02.05.2000 82.2 14 3900 320580 03.05.2000 85.45 9 2000 170900 04.05.2000 88.85 5 1100 97735 05.05.2000 92.35 25 7600 701860 08.05.2000 96 5 800 76800 09.05.2000 99.8 95 99.8 63 22300 2204465 10.05.2000 103.75 102.9 103.75 30 11000 1140825 11.05.2000 107.85 105 107.85 20 6200 667670 12.05.2000 111.95 109.25 112.15 76 8400 934805 15.05.2000 116.6 19 5000 583000 16.05.2000 121.25 10 6000 727500 17.05.2000 126.05 24 4900 617645 18.05.2000 131.05 126.2 131.05 65 11300 1478655 19.05.2000 136.25 134.15 135.5 44 10500 1427650 22.05.2000 140.9 140 140.9 16 5300 746560 23.05.2000 146.5 8 2800 410200 24.05.2000 152.35 151.9 152.35 30 4200 639330 25.05.2000 158.4 17 7400 1172160 26.05.2000 164.7 152.1 157.7 118 20600 3278165 29.05.2000 163.9 158 163.95 27 3900 638150 30.05.2000 170.45 13 5400 920430 31.05.2000 177.25 18 6900 1223025 01.06.2000 183.2 180.5 184.3 71 15500 2844845 02.06.2000 191.4 191.65 44 20300 3890395 05.06.2000 199.3 4 4500 896850 06.06.2000 207.25 6 3700 766825 07.06.2000 215.5 19 4900 1055950 08.06.2000 223.9 220 224.1 58 16500 3696650 09.06.2000 233 233.05 42 22000 5127075 12.06.2000 242.35 37 10900 2641615 13.06.2000 252 35 6800 1713600 14.06.2000 262.05 21 4600 1205430 15.06.2000 272.5 252.65 272.5 136 19600 5273530 16.06.2000 283 277.5 283.35 112 23300 6583680 19.06.2000 294.65 8 3200 942880 20.06.2000 306.4 9 2200 674080 21.06.2000 318.6 300 318.6 94 13600 4297665 22.06.2000 331.3 324.5 331.3 139 25700 8493095 23.06.2000 338.9 341.5 318.05 319.85 130 20300 6665735 26.06.2000 332.6 310 332.6 59 8900 2942500 27.06.2000 344 340 345.85 106 13400 4622250 28.06.2000 351 358 345 349.95 56 5900 2064035 29.06.2000 356 358.5 336 344.35 125 17000 5963530 30.06.2000 330.6 335 330.6 35 4800 1587740 03.07.2000 317.4 23 4100 1301340 04.07.2000 304.75 1 100 30475 05.07.2000 292.6 2 200 58520 06.07.2000 280.9 31 3300 926970 07.07.2000 269.7 279 270.05 107 23700 6423400 10.07.2000 275 280.8 8 1500 420620 11.07.2000 292 1 2300 671600 12.07.2000 303.65 42 12000 3643800 13.07.2000 310 298 315.75 100 18200 5651015 14.07.2000 328 324 328.35 102 16700 5470945 17.07.2000 341.45 3 1100 375595 18.07.2000 355.05 6 1700 603585 19.07.2000 369.2 30 6300 2325960 20.07.2000 383.95 360 383.95 175 26600 10017250 21.07.2000 391 385 399.25 93 15500 6142410 24.07.2000 415.2 12 2800 1162560 25.07.2000 431 398.6 431.75 120 15500 6503720 26.07.2000 440 430 449 114 15300 6790205 27.07.2000 460 449 466.95 105 12300 5704930 28.07.2000 483.9 480 485.6 106 15700 7609985 31.07.2000 505 490 505 57 11100 5600600 01.08.2000 525 525.15 33 4500 2362950 02.08.2000 545 546.1 41 6200 3385140 03.08.2000 567.9 50 8200 4656780 04.08.2000 589 590.6 545.2 561.4 210 28300 16199665 07.08.2000 539 575 538.95 184 22900 12718270 08.08.2000 521 517.4 32 4300 2226790 09.08.2000 496.75 4 400 198700 10.08.2000 476.9 487 476.9 163 27200 12982165 11.08.2000 476.9 494.7 457.85 459.15 215 32900 15489325 14.08.2000 461 452 477.5 49 5600 2612475 16.08.2000 496.55 494.9 496.55 47 5900 2927920 17.08.2000 516.4 6 1100 568040 18.08.2000 537 513 537 220 36100 19078755 21.08.2000 579.95 553 572.95 167 22200 12623870 22.08.2000 600 527.15 543.75 322 43300 23452870 23.08.2000 540.7 500.3 115 21600 10970965 24.08.2000 461 480 460.3 70 20700 9571110 25.08.2000 423.5 480 445.8 159 26300 11234485 28.08.2000 481.45 2 500 240725 XD 29.08.2000 519.95 3 400 207980 30.08.2000 561.5 3 400 224600 31.08.2000 606.4 11 1900 1152160 04.09.2000 654.9 557.9 654.9 233 50300 31528435 05.09.2000 666 700 620 638.35 185 29800 19190460 06.09.2000 640 643 587.3 599.75 170 30700 18978625 07.09.2000 605 631 573.1 624.8 151 28000 16425885 08.09.2000 607.05 674.75 606 674.6 264 34800 22332070 11.09.2000 697 724 651 663.7 160 24800 16867765 12.09.2000 660 663 615 620.45 127 16000 10128560 13.09.2000 625 644.95 605 630 85 16200 10139350 14.09.2000 625 630 620 624.2 103 23700 14801390 15.09.2000 625 628 588 602.05 107 19300 11742280 18.09.2000 592 553.9 558.85 86 15400 8711775 19.09.2000 520.05 582 514.15 533 63 9000 4897200 20.09.2000 545 575.6 542.1 554.65 120 15100 8380705 21.09.2000 565 570 511 515.2 81 12100 6399010 22.09.2000 485 513 474 474.8 79 13400 6420040 25.03.2000 507 512.75 490 49 21600 11037160 26.09.2000 473 485 450.85 453 116 16900 7793320 27.09.2000 442 450 416.8 89 14300 6317325 28.09.2000 401.5 406 384 389.5 115 15300 6092920 29.09.2000 415 358.35 360.2 69 16200 6136690 03.10.2000 331.4 370 331.4 151 21300 7141505 04.10.2000 304.9 357.9 228 31600 10322165 05.10.2000 378 386.5 371 375.35 232 34700 13223135 06.10.2000 367 380 345.35 355 81 9600 3503905 09.10.2000 383.3 366.5 383.35 12 2900 1108390 10.10.2000 414 365 390 113 17000 6643745 11.10.2000 375 400 358.85 363.2 63 6600 2449445 12.10.2000 355 370 345 363 140 21800 7843225 13.10.2000 350 365 334 342.65 115 15900 5531190 16.10.2000 370.05 365 370.05 25 3900 1435340 17.10.2000 352.05 386.95 340.45 344 107 15400 5407245 18.10.2000 339 359.95 338.1 349.95 61 6100 2082980 19.10.2000 340 377.8 56 8500 3091925 20.10.2000 400 404.9 347.6 350.05 61 6400 2393330 23.10.2000 364.95 365 348 354 80 9000 3209595 24.10.2000 368 345 88 11700 4149910 25.10.2000 340 345 335 339 75 10100 3435000 26.10.2000 359.95 366.1 7 900 328265 30.10.2000 351.05 385 336 371.2 172 21900 7730005 31.10.2000 375 379.95 365 371.2 109 16400 6079305 01.11.2000 379 345 352 93 11700 4178680 02.11.2000 350 355 338 340 79 9400 3241000 03.11.2000 340 350 325 332.65 83 12600 4277730 06.11.2000 350 355.7 335 345.4 136 16200 5621905 08.11.2000 345 357 332.5 341.5 72 8300 2839475 07.11.2000 352 354.95 343 349.9 123 17300 6002895 08.11.2000 345 357 332.5 341.5 72 8300 2839475 09.11.2000 368.25 337.25 89 12000 4101345 10.11.2000 337 340 322.2 53 5400 1814830

    13. The clients of the Noticee who traded in SIL scrip through the main broker IKM were Ashok Kumar Chaudhary, Ramesh Kumar, S.K Marwah, Rajendra Rai and Chander Mohini Anand. I find that Ashok Kumar Chaudhary had introduced S.K Marwah and Ramesh Kumar Chaudhary to the Noticee. Rajesh Kumar Chaudhary is the brother of Ashok Kumar Chaudhary. S.K Marwah is the father of Manish Kumar Marwah who was associated with the meager of SIL and Zap Infotech. It was also observed that Shri Asok Kumar Choudhary and Shri Manish Kumar Marwah had placed orders and taken deliveries on behalf of Rajendra Rai who was actually a front of Kuldip Handoo. All these clients traded heavily in the scrip during the investigation period through the Noticee who was registered as a sub-broker only on March 16, 2000.

    14. Investigation revealed that Shri Ashok Kumar Chaudhary was the friend of Shri Kuldip Handoo who along with Shri Dilip Nabera had made the entire game of manipulation in the scrip. Dilip Nabera also traded in the scrip in his HUF account (Dilip Nabera HUF) and Adhunik Finance Pvt. Ltd., an entity in which his wife Sadhana Nabera was a director.

    15. The Enquiry Officer has found several instances of trading done by the Noticee for their client; Rajendra Rai with the counter party member being; N.C Jain for their client; R.K Chaudhary, brother of Asok Kumar Chaudhary. Several of the trades of the Noticee through IKM, for Rajender Rai were found to be matched with the trades of another broker; JCL Securities Pvt. Ltd. for their client; Adhunik Finance Private Limited (AFPL) on the other side. The transactions of the Noticee through their main broker; IKM (member code D0766) who bought for Rajendra Rai and NC Jain (Member code D0519) sold for Rajesh Kumar Chaudhary, are as follows:

    DATE TIME MEMBER QUANTITY PRICE B/S CP CODE CLIENT CODE COUNTER CLIENT 14-Jul-00 10:23:02 AM D0766 100 327.9 B D0519 RR RAJ 2 28-Jul-00 10:45:31 AM D0766 2000 485.6 B D0519 RR RAJ2 4-Aug-00 10:22:56 AM D0766 200 570 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:06 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:43:35 AM D0766 100 521.5 B D0519 RR RAJ2 18-Aug-00 11:46:10 AM D0766 2000 525 B D0519 RR RAJ2 18-Aug-00 1:22:21 PM D0766 100 524 B D0519 RR RAJ2 22-Aug-00 1:31:10 PM D0766 100 544 B D0519 RR RAJ2 22-Aug-00 1:31:10 PM D0766 100 544 B D0519 RR RAJ2 23-Aug-00 11:06:18 AM D0766 300 510 B D0519 RR RAJ2 23-Aug-00 11:06:55 AM D0766 300 512 B D0519 RR RAJ2 23-Aug-00 11:07:29 AM D0766 1000 515 B D0519 RR RAJ2 23-Aug-00 11:07:49 AM D0766 400 517 B D0519 RR RAJ2 23-Aug-00 11:13:15 AM D0766 500 524 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:52:57 AM D0766 100 480 B D0519 RR RAJ2 24-Aug-00 10:53:29 AM D0766 1000 475 B D0519 RR RAJ2 6-Sep-00 10:08:14 AM D0766 2000 640 B D0519 RR RAJ2 7-Sep-00 10:06:37 AM D0766 100 610.5 B D0519 RR RAJ2 7-Sep-00 10:07:07 AM D0766 300 605 B D0519 RR RAJ2 7-Sep-00 10:07:29 AM D0766 100 608 B D0519 RR RAJ2 7-Sep-00 2:11:25 PM D0766 900 584.5 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 8-Sep-00 12:33:08 PM D0766 100 630.9 B D0519 RR RAJ2 11-Sep-00 10:08:59 AM D0766 500 720 B D0519 RR RAJ2 11-Sep-00 10:25:16 AM D0766 100 704 B D0519 RR RAJ2 11-Sep-00 10:25:42 AM D0766 100 705 B D0519 RR RAJ2 11-Sep-00 10:28:03 AM D0766 100 706.7 B D0519 RR RAJ2 11-Sep-00 3:29:19 PM D0766 100 662 B D0519 RR RAJ2 12-Sep-00 10:04:31 AM D0766 200 660 B D0519 RR RAJ2 12-Sep-00 10:05:20 AM D0766 100 660 B D0519 RR RAJ2 12-Sep-00 3:28:19 PM D0766 100 624 B D0519 RR RAJ2 13-Sep-00 10:03:40 AM D0766 800 625 B D0519 RR RAJ2 13-Sep-00 10:13:59 AM D0766 300 621 B D0519 RR RAJ2 13-Sep-00 11:34:22 AM D0766 200 633 B D0519 RR RAJ2 14-Sep-00 10:18:23 AM D0766 500 625 B D0519 RR RAJ2 14-Sep-00 10:18:35 AM D0766 500 630 B D0519 RR RAJ2 14-Sep-00 10:23:22 AM D0766 100 623.7 B D0519 RR RAJ2 14-Sep-00 10:23:22 AM D0766 100 623.7 B D0519 RR RAJ2 14-Sep-00 10:25:13 AM D0766 100 623.7 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:14 AM D0766 100 625 B D0519 RR RAJ2 15-Sep-00 10:06:34 AM D0766 200 627 B D0519 RR RAJ2 18-Sep-00 10:00:53 AM D0766 200 592 B D0519 RR RAJ2 18-Sep-00 3:05:24 PM D0766 300 561 B D0519 RR RAJ2 19-Sep-00 11:39:54 AM D0766 100 550 B D0519 RR RAJ2 19-Sep-00 11:45:50 AM D0766 100 553 B D0519 RR RAJ2 19-Sep-00 11:46:05 AM D0766 100 555 B D0519 RR RAJ2 19-Sep-00 11:55:15 AM D0766 100 567 B D0519 RR RAJ2 19-Sep-00 11:55:26 AM D0766 200 567 B D0519 RR RAJ2 19-Sep-00 12:11:39 PM D0766 300 582 B D0519 RR RAJ2 19-Sep-00 12:21:47 PM D0766 200 570 B D0519 RR RAJ2 19-Sep-00 12:50:06 PM D0766 100 575 B D0519 RR RAJ2 20-Sep-00 10:11:15 AM D0766 100 550 B D0519 RR RAJ2 20-Sep-00 10:11:41 AM D0766 100 560 B D0519 RR RAJ2 20-Sep-00 10:11:52 AM D0766 100 565 B D0519 RR RAJ2 20-Sep-00 10:16:09 AM D0766 100 560 B D0519 RR RAJ2 20-Sep-00 10:16:18 AM D0766 100 562 B D0519 RR RAJ2 20-Sep-00 10:55:49 AM D0766 200 565 B D0519 RR RAJ2 21-Sep-00 10:12:02 AM D0766 200 570 B D0519 RR RAJ2 22-Sep-00 2:46:03 PM D0766 100 513 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 26-Sep-00 11:42:46 AM D0766 100 481 B D0519 RR RAJ2 27-Sep-00 10:23:49 AM D0766 100 442 B D0519 RR RAJ2 27-Sep-00 10:24:14 AM D0766 100 445 B D0519 RR RAJ2 27-Sep-00 10:24:14 AM D0766 100 447 B D0519 RR RAJ2 27-Sep-00 10:25:01 AM D0766 100 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 27-Sep-00 10:36:39 AM D0766 300 450 B D0519 RR RAJ2 3-Oct-00 10:57:40 AM D0766 100 370 B D0519 RR RAJ2 3-Oct-00 10:57:40 AM D0766 100 370 B D0519 RR RAJ2 3-Oct-00 10:57:40 AM D0766 100 370 B D0519 RR RAJ2 3-Oct-00 10:57:40 AM D0766 100 370 B D0519 RR RAJ2 3-Oct-00 10:57:40 AM D0766 100 370 B D0519 RR RAJ2 3-Oct-00 2:34:02 PM D0766 300 338.5 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 316 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.9 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315.6 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 4-Oct-00 10:28:27 AM D0766 100 315 B D0519 RR RAJ2 5-Oct-00 10:14:50 AM D0766 500 384 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 10:40:48 AM D0766 200 385.7 B D0519 RR RAJ2 5-Oct-00 1:50:35 PM D0766 600 386.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 5-Oct-00 3:01:00 PM D0766 100 385.5 B D0519 RR RAJ2 12-Oct-00 12:04:44 PM D0766 100 370 B D0519 RR RAJ2 2-Nov-00 10:16:06 AM D0766 100 350 B D0519 RR RAJ2 8-Nov-00 2:29:46 PM D0766 100 348 B D0519 RR RAJ2 8-Nov-00 2:29:46 PM D0766 100 345 B D0519 RR RAJ2 10-Nov-00 10:44:51 AM D0766 100 337 B D0519 RR RAJ2 10-Nov-00 10:45:07 AM D0766 100 340 B D0519 RR RAJ2 TOTAL 36000

    16. Similarly, in the other leg of transactions, Rajesh Kumar Chaudhary was buying through NC Jain and the counter party broker was Compuaction via IKM, who was selling for their client; Rajendra Rai and the details of such trades are given below:

    DATE TIME MEMBER QUANTITY PRICE B/S CP CODE CLIENT CODE COUNTER CLIENT 13-Jul-00 10:04:59 AM D0766 300 301 S D0519 RR RAJ2 13-Jul-00 10:05:27 AM D0766 200 301 S D0519 RR RAJ2 13-Jul-00 10:06:09 AM D0766 500 298 S D0519 RR RAJ2 13-Jul-00 10:18:42 AM D0766 500 302 S D0519 RR RAJ2 13-Jul-00 10:19:15 AM D0766 500 302.1 S D0519 RR RAJ2 13-Jul-00 10:20:14 AM D0766 1000 301.5 S D0519 RR RAJ2 13-Jul-00 10:27:08 AM D0766 100 306 S D0519 RR RAJ2 20-Jul-00 10:51:51 AM D0766 100 361.5 S D0519 RR RAJ2 20-Jul-00 10:55:12 AM D0766 400 365 S D0519 RR RAJ2 28-Jul-00 10:44:45 AM D0766 2000 480 S D0519 RR RAJ2 10-Aug-00 2:04:45 PM D0766 200 476.9 S D0519 RR RAJ2 18-Aug-00 2:05:39 PM D0766 100 520.5 S D0519 RR RAJ2 21-Aug-00 2:25:43 PM D0766 100 566 S D0519 RR RAJ2 22-Aug-00 10:50:48 AM D0766 500 545 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:51:47 AM D0766 100 536 S D0519 RR RAJ2 22-Aug-00 10:52:33 AM D0766 100 536 S D0519 RR RAJ2 23-Aug-00 11:17:15 AM D0766 2000 500.3 S D0519 RR RAJ2 23-Aug-00 11:25:48 AM D0766 400 505 S D0519 RR RAJ2 23-Aug-00 11:26:21 AM D0766 100 507 S D0519 RR RAJ2 24-Aug-00 10:59:14 AM D0766 500 465 S D0519 RR RAJ2 24-Aug-00 11:00:03 AM D0766 500 462 S D0519 RR RAJ2 24-Aug-00 11:00:40 AM D0766 1000 462 S D0519 RR RAJ2 4-Sep-00 10:56:55 AM D0766 600 600 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 10:42:51 AM D0766 100 628 S D0519 RR RAJ2 6-Sep-00 11:00:14 AM D0766 300 620 S D0519 RR RAJ2 6-Sep-00 11:01:26 AM D0766 300 622 S D0519 RR RAJ2 6-Sep-00 11:14:45 AM D0766 100 620 S D0519 RR RAJ2 6-Sep-00 11:16:06 AM D0766 300 620 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 8-Sep-00 12:32:40 PM D0766 100 629.5 S D0519 RR RAJ2 11-Sep-00 10:14:55 AM D0766 500 705 S D0519 RR RAJ2 11-Sep-00 10:24:24 AM D0766 300 700 S D0519 RR RAJ2 11-Sep-00 10:31:34 AM D0766 300 683 S D0519 RR RAJ2 11-Sep-00 10:44:33 AM D0766 200 681 S D0519 RR RAJ2 12-Sep-00 10:05:14 AM D0766 300 650 S D0519 RR RAJ2 12-Sep-00 10:32:12 AM D0766 100 618 S D0519 RR RAJ2 13-Sep-00 10:21:28 AM D0766 300 619.5 S D0519 RR RAJ2 13-Sep-00 11:29:30 AM D0766 100 623.5 S D0519 RR RAJ2 13-Sep-00 11:29:30 AM D0766 100 623.5 S D0519 RR RAJ2 13-Sep-00 11:29:30 AM D0766 100 623.5 S D0519 RR RAJ2 13-Sep-00 11:29:30 AM D0766 100 623.5 S D0519 RR RAJ2 13-Sep-00 11:29:30 AM D0766 100 623.5 S D0519 RR RAJ2 13-Sep-00 11:29:30 AM D0766 100 625 S D0519 RR RAJ2 13-Sep-00 11:30:26 AM D0766 200 626 S D0519 RR RAJ2 13-Sep-00 11:34:08 AM D0766 200 620 S D0519 RR RAJ2 13-Sep-00 11:59:03 AM D0766 100 620 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 14-Sep-00 10:26:18 AM D0766 200 625 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:05 AM D0766 100 624 S D0519 RR RAJ2 15-Sep-00 10:20:36 AM D0766 200 628 S D0519 RR RAJ2 18-Sep-00 10:18:56 AM D0766 200 575 S D0519 RR RAJ2 19-Sep-00 11:22:37 AM D0766 400 521.1 S D0519 RR RAJ2 19-Sep-00 11:58:56 AM D0766 200 566 S D0519 RR RAJ2 19-Sep-00 12:17:41 PM D0766 300 580 S D0519 RR RAJ2 19-Sep-00 12:18:57 PM D0766 100 555 S D0519 RR RAJ2 19-Sep-00 12:23:52 PM D0766 200 565 S D0519 RR RAJ2 19-Sep-00 1:31:48 PM D0766 100 555 S D0519 RR RAJ2 20-Sep-00 10:50:59 AM D0766 500 552 S D0519 RR RAJ2 20-Sep-00 11:04:25 AM D0766 200 550 S D0519 RR RAJ2 21-Sep-00 10:23:07 AM D0766 100 565 S D0519 RR RAJ2 21-Sep-00 10:23:37 AM D0766 100 567 S D0519 RR RAJ2 22-Sep-00 2:45:41 PM D0766 100 510 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 26-Sep-00 11:42:04 AM D0766 100 480 S D0519 RR RAJ2 27-Sep-00 10:24:53 AM D0766 400 442 S D0519 RR RAJ2 27-Sep-00 10:37:28 AM D0766 1000 449 S D0519 RR RAJ2 27-Sep-00 10:37:48 AM D0766 1000 448.5 S D0519 RR RAJ2 27-Sep-00 10:38:32 AM D0766 1000 447 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:08:02 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 335 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:09:45 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:10:09 AM D0766 100 334 S D0519 RR RAJ2 3-Oct-00 11:10:09 AM D0766 200 334 S D0519 RR RAJ2 3-Oct-00 11:55:17 AM D0766 100 346 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 4-Oct-00 10:24:33 AM D0766 400 315 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:40:01 AM D0766 200 385 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 10:56:31 AM D0766 100 372.1 S D0519 RR RAJ2 5-Oct-00 11:04:36 AM D0766 300 375 S D0519 RR RAJ2 5-Oct-00 11:05:05 AM D0766 500 375 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:07:27 AM D0766 100 374 S D0519 RR RAJ2 5-Oct-00 11:34:47 AM D0766 600 373 S D0519 RR RAJ2 5-Oct-00 11:35:03 AM D0766 100 380 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 11-Oct-00 1:17:08 PM D0766 100 375 S D0519 RR RAJ2 8-Nov-00 3:27:16 PM D0766 100 342 S D0519 RR RAJ2 8-Nov-00 3:27:16 PM D0766 100 341 S D0519 RR RAJ2 TOTAL 43100

    17. I find from the above two tables that approximately 1.5% of the total trades in the scrip of SIL during the period under investigation were initiated by these two entities i.e the Noticee through IKM for Rajender Rai and NC Jain for Rajesh Kumar. The Enquiry Officer further found that on the same day, these two members reversed their transactions i.e buying and selling on both sides for the same clients for almost the same number of shares. This reversal in positions of the trades by the two clients Rajendra Rai (RR) and Rajesh Chaudhary (Raj2), brother of Ashok Chaudhary, while trading through the two brokers viz: IKM (DO766) through their sub broker; Compuaction and N.C Jain Page 19 of 30 (D0519) in the scrip, during the period under investigation is brought out in the table below:

    Date of transaction Buy member Sell member Buy client Sell client Total trades 28.07.00 IKM N.C Jain RR RAJ2 2000 N.C Jain IKM RAJ2 RR 2000 18.08.00 IKM N.C Jain RR RAJ2 100 N.C Jain IKM RAJ2 RR 2900 22.08.00 IKM N.C Jain RR RAJ2 1600 N.C Jain IKM RAJ2 RR 200 23.08.00 IKM N.C Jain RR RAJ2 2500 N.C Jain IKM RAJ2 RR 2500 24.08.00 IKM N.C Jain RR RAJ2 2000 N.C Jain IKM RAJ2 RR 2000 06.09.00 IKM N.C Jain RR RAJ2 2000 N.C Jain IKM RAJ2 RR 2000 08.09.00 IKM N.C Jain RR RAJ2 1000 N.C Jain IKM RAJ2 RR 1000 11.09.00 IKM N.C Jain RR RAJ2 1300 N.C Jain IKM RAJ2 RR 900 12.09.00 IKM N.C Jain RR RAJ2 400 N.C Jain IKM RAJ2 RR 400 13.09.00 IKM N.C Jain RR RAJ2 1400 N.C Jain IKM RAJ2 RR 1300 14.09.00 IKM N.C Jain RR RAJ2 1400 N.C Jain IKM RAJ2 RR 1300 15.09.00 IKM N.C Jain RR RAJ2 1200 N.C Jain IKM RAJ2 RR 1200 18.09.00 IKM N.C Jain RR RAJ2 500 N.C Jain IKM RAJ2 RR 500 19.09.00 IKM N.C Jain RR RAJ2 1300 N.C Jain IKM RAJ2 RR 1700 20.09.00 IKM N.C Jain RR RAJ2 700 N.C Jain IKM RAJ2 RR 700 21.09.00 IKM N.C Jain RR RAJ2 200 N.C Jain IKM RAJ2 RR 200 22.09.00 IKM N.C Jain RR RAJ2 100 N.C Jain IKM RAJ2 RR 100 26.09.00 IKM N.C Jain RR RAJ2 1000 N.C Jain IKM RAJ2 RR 1000 27.09.00 IKM N.C Jain RR RAJ2 3400 N.C Jain IKM RAJ2 RR 3400 03.10.00 IKM N.C Jain RR RAJ2 800 N.C Jain IKM RAJ2 RR 4000 04.10.00 IKM N.C Jain RR RAJ2 4000 N.C Jain IKM RAJ2 RR 4000 05.10.00 IKM N.C Jain RR RAJ2 4000 N.C Jain IKM RAJ2 RR 5500 08.11.00 IKM N.C Jain RR RAJ2 200 N.C Jain IKM RAJ2 RR 200

    18. From the above table, it is observed that Rajendra Rai and Rajesh Chaudhary, through the Noticee via IKM and N.C Jain had done such reversal of positions which means that the trades were done without actual change in beneficial ownership, in as much as on many days, the same number of shares were bought and sold i.e positions were merely reversed on the same day by these two clients while trading through these two brokers. When the Noticee was buying, N.C Jain was selling and vice versa. These transactions were spread across July to November i.e well within the period of investigation and thus gave a misleading appearance of trading and resulted in the creation of an artificial market and volumes, thus enhancing liquidity in the scrip of SIL, which was otherwise illiquid.

    19. The Enquiry Officer has further observed that there were other trades where the buyer was Ashok Chaudhary, through the Noticee and the seller was Rajesh Kumar, brother of Ashok Chaudhary through NC Jain. Once again Ashok Chaudhary was found to have sold through the Noticee and the counter party buyer in this instance was Rajesh Kumar through NC Jain. The volumes of these transactions, though small, is significant compared to the total trade of these members and have been detailed below:

    DATE TIME MEMBER QUANTITY PRICE B/S CP CODE CLIENT CODE COUNTER CLIENT 22/06/2000 10:18:32 AM D0766 100 329.7 B D0519 A RAJ2 22/06/2000 10:18:32 AM D0766 100 329.7 B D0519 A RAJ2 22/06/2000 10:18:32 AM D0766 100 329.7 B D0519 A RAJ2 22/06/2000 10:20:32 AM D0766 100 329 B D0519 A RAJ2 4/9/2000 10:57:54 AM D0766 600 602 B D0519 A RAJ2 29/06/2000 10:14:43 AM D0766 100 358.5 B D0519 A RAJ2 29/06/2000 10:15:54 AM D0766 100 358.5 B D0519 A RAJ2 TOTAL 1200

    Transactions where seller was Ashok Chaudhary through Compuaction/IKM and the buyer was Rajesh Kumar through N.C Jain

    DATE TIME MEMBER QUANTITY PRICE B/S CP CODE CLIENT CODE COUNTER CLIENT 24/04/2000 10:45:42 AM D0766 100 67.7 S D0519 A RAJ2 18/05/2000 11:01:39 AM D0766 200 130.8 S D0519 A RAJ2 21/06/2000 12:23:55 PM D0766 200 318.6 S D0519 A RAJ2 18/09/2000 3:04:56 PM D0766 100 560 S D0519 A RAJ2 18/09/2000 3:04:56 PM D0766 100 560 S D0519 A RAJ2 18/09/2000 3:04:56 PM D0766 100 560 S D0519 A RAJ2 TOTAL 800

    20. I find that Ashok Chaudhary traded in the scrip of SIL when its price rose from Rs. 11.34 to Rs. 566.21 Incidentally Ashok Chaudhary was also found to have traded through R.S Investments, an unregistered sub broker of Jhunjhunwala Stock Broker. Transactions where Ashok Chaudhary sold through R.S Investments and Rajendra Rai bought through Compuaction, via IKM are given hereunder:

    DATE TIME MEMBER QUANTITY PRICE B/S CP CODE CLIENT CODE COUNTER CLIENT 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 200 570 S D0766 10007 RR 4/8/2000 2:59:49 PM D0717 100 570 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 800 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 200 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 600 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 400 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 400 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 600 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 200 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 800 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 800 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 200 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 600 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 400 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 400 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 600 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 200 462 S D0766 10007 RR 11/8/2000 2:47:39 PM D0717 800 462 S D0766 10007 RR Total 9500

    21. The Enquiry Officer has also given instances of trades where the buyer was R.S Investment for Telefinlease (a company belonging to S.K Marwah, Suman Pandit and Anil Raina) and the seller was the Noticee for their clients Ashok Kumar Chaudhary and Rajender Rai, through the Noticee and the details whereof are hereunder:

    Date Time Member Quantity Price B/S Cpcode Client Code Counter Party Client 4/8/2000 10:15:15 D0717 500 584 B D0766 10007 A 4/8/2000 10:15:15 D0717 500 583 B D0766 10007 A 15/06/2000 12:30:09 D0717 100 272.5 B D0766 7 A 4/8/2000 10:17:44 D0717 300 582 B D0766 10007 A 21/07/2000 10:59:21 D0717 1600 397 B D0766 7 RR TOTAL 3000

    The details of the trades done by S.K Marwah who traded in the scrip when its price rose from Rs. 41.21 to Rs. 274.23 are given hereunder:

    Sett. No. Buy Quantity Value Paid Price Quantity Sold Value Recd. Price 02 11900 490399 41.21 11800 498314 42.23 03 2200 113740 51.70 500 27560 55.12 05 5100 372504 73.04 5100 343536 67.36 08 2900 379465 130.85 2900 381640 131.60 09 1600 242272 151.42 1600 254656 159.16 10 1400 262010 187.15 -- 0 -- 11 600 128058 213.43 600 136416 227.36 12 4200 1151766 274.23 100 27265 272.65 TOTAL 29900 3140214 TOTAL 22600 1669387

    22. I find that the orders of Rajinder Rai and S.K Marwah were placed by A.K Chaudhary and/or Manish Marwah (s/o S.K Marwah) (clients of the Noticee) and delivery were also given/received by them as admitted by Kapil Awal, Manager of the Noticee in his statement dated January 10, 2002. Manish Marwah was also involved in introducing the new promoters and directors to the old promoters and directors of SIL. As per the statement of Shri Shrikant Joglekar, former director of SIL, Manish Marwah had finalized the deal of the takeover of SIL through Anil Pujari, Hozefa Vohera and other persons acting in concert.

    23. I find that several trades of the Noticee for their client Rajendra Rai were matched with the trades executed by Adhunik Finance Private Limited (AFPL). A director of AFPL is Sadhana Nabera, wife of Dilip Nabera who was auditor of SIL. Dilip Nabera had introduced several clients and placed orders in the scrip of SIL on their behalf and delivered the shares for trading. In 80% of these trades, the clients belonged to the Nabera Group and Kuldip Handoo Group who were associated with SIL.

    24. As is apparent from the table below, of the total volume of 32,600 shares traded between the Noticee and AFPL, trades upto a volume of 19200 shares were matched, which represented 59% of the total trades between them for their respective clients. The following table illustrates such instances:

    Date Time Member Quantity Price B/S CP Code Client Code Counter Party Client 22/08/2000 10:38:54 AM D0216 100 562.1 B D0766 4015 RR 22/08/2000 10:38:54 AM D0216 100 562.1 B D0766 4015 RR 22/08/2000 10:38:54 AM D0216 100 562.1 B D0766 4015 RR 22/08/2000 10:38:54 AM D0216 100 562.1 B D0766 4015 RR 22/08/2000 10:38:54 AM D0216 100 562.1 B D0766 4015 RR 22/08/2000 10:45:13 AM D0216 100 559 B D0766 4015 RR 22/08/2000 10:45:35 AM D0216 100 559 B D0766 4015 RR 22/08/2000 10:45:35 AM D0216 100 559 B D0766 4015 RR 22/08/2000 10:45:35 AM D0216 100 559 B D0766 4015 RR 22/08/2000 10:45:35 AM D0216 100 559 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 22/08/2000 11:10:39 AM D0216 100 527.2 B D0766 4015 RR 18/08/2000 1:01:38 PM D0216 100 527.5 B D0766 4015 RR 22/08/2000 11:10:39 AM D0216 100 527.2 B D0766 4015 RR 22/08/2000 11:13:27 AM D0216 100 527.2 B D0766 4015 RR 22/08/2000 11:13:27 AM D0216 100 527.2 B D0766 4015 RR 18/08/2000 1:22:38 PM D0216 100 526 B D0766 4015 RR 18/08/2000 1:22:38 PM D0216 100 526 B D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 12:04:13 PM D0216 100 527.2 S D0766 4015 RR 22/08/2000 1:40:16 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:16 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:16 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:16 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:16 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:47 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:47 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:47 PM D0216 100 548.2 B D0766 4015 RR 22/08/2000 1:40:47 PM D0216 100 548.2 B D0766 4015 RR 23/08/2000 10:46:05 AM D0216 100 500.3 B D0766 4015 RR 23/08/2000 10:49:53 AM D0216 100 500.3 B D0766 4015 RR 23/08/2000 10:59:46 AM D0216 2000 500.3 B D0766 4015 RR 24/08/2000 12:30:44 PM D0216 1000 460.3 B D0766 4015 RR 7/9/2000 2:29:17 PM D0216 200 586 B D0766 4015 RR 7/9/2000 2:30:08 PM D0216 100 586 B D0766 4015 RR 7/9/2000 2:31:55 PM D0216 200 586 B D0766 4015 RR 7/9/2000 2:33:16 PM D0216 200 586 B D0766 4015 RR 7/9/2000 2:33:16 PM D0216 200 586 B D0766 4015 RR 7/9/2000 2:33:16 PM D0216 100 586 B D0766 4015 RR 7/9/2000 2:34:02 PM D0216 100 586 B D0766 4015 RR 7/9/2000 2:35:19 PM D0216 100 586 B D0766 4015 RR 7/9/2000 2:35:19 PM D0216 100 586 B D0766 4015 RR 7/9/2000 2:35:19 PM D0216 100 586 B D0766 4015 RR 7/9/2000 2:35:19 PM D0216 100 586 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 11/9/2000 11:29:36 AM D0216 200 693 B D0766 4015 RR 14/09/2000 12:23:02 PM D0216 200 626 B D0766 4015 RR 4/8/2000 3:27:05 PM D0216 200 565 B D0766 3001 RR 4/8/2000 11:07:41 AM D0216 100 572 B D0766 9A033 RR 11/9/2000 10:53:24 AM D0216 700 695 S D0766 9A033 RR 11/9/2000 10:53:24 AM D0216 700 695 S D0766 9A033 RR 11/9/2000 10:53:24 AM D0216 600 695 S D0766 9A033 RR 4/9/2000 10:40:58 AM D0216 100 623 S D0766 DILIP RR 4/9/2000 12:10:37 PM D0216 200 600 S D0766 DILIP RR 5/9/2000 10:37:37 AM D0216 200 623 S D0766 DILIP RR 6/9/2000 12:50:14 PM D0216 200 608 B D0766 K018 RR 19/09/2000 11:50:56 AM D0216 200 556 B D0766 K018 RR 8/9/2000 11:17:26 AM D0216 100 628 S D0766 4024 A 8/9/2000 2:33:40 PM D0216 100 660 B D0766 4024 A 8/9/2000 2:35:37 PM D0216 100 663 B D0766 4024 A 8/9/2000 2:36:50 PM D0216 100 663 B D0766 4024 A 8/9/2000 2:36:50 PM D0216 100 663 B D0766 4024 A 8/9/2000 2:36:50 PM D0216 100 663 B D0766 4024 A 8/9/2000 2:36:50 PM D0216 100 663 B D0766 4024 A 8/9/2000 2:36:50 PM D0216 100 663 B D0766 4024 A 24/04/2000 12:23:35 PM D0216 600 67.7 B D0766 SADANA A 24/04/2000 3:26:03 PM D0216 2000 67.7 B D0766 SADANA A 18/07/2000 10:32:06 AM D0216 300 355.1 S D0766 K018 A 19/09/2000 11:50:37 AM D0216 100 554 B D0766 K018 A 26/07/2000 3:23:02 PM D0216 500 449 B D0766 4015 ZSAF1 2/6/2000 10:20:59 AM D0216 100 191.7 S D0766 8078 SKM 26/05/2000 3:28:33 PM D0216 100 155 S D0766 8099 SKM 16/06/2000 11:54:46 AM D0216 100 283 S D0766 8078 SKM

    25. An analysis of the table given above shows that 89 of the trades between the Noticee through IKM and JCL were found to be structured and were executed in 18 trading days and several client codes were used for AFPL viz. 4131, 4015, 3001, 9A03, ADH, ADHUNIK, ADHU, ADUNIK and 4024. Apart from these trades, similar trades were also observed where the client Apoorv was selling through Shilpa Stock Brokers and Ashok Kumar Chaudhry was buying through the Noticee, the details whereof are hereunder:

    Date Time Member Quantity Price B/S Cpcode Client Code Counter Party Client 27/06/2000 9:55:47 AM D0608 300 345.9 S D0766 APOORV JI02 27/06/2000 10:19:02 AM D0608 200 341 S D0766 APOORV A 27/06/2000 10:19:02 AM D0608 200 341 S D0766 APOORV A 27/06/2000 10:19:02 AM D0608 100 341 S D0766 APOORV A TOTAL 1200

    26. Thus there were numerous instances of transactions executed through the Noticee in only one scrip, wherein the buy and the sell orders were placed at almost the same time, with just a difference of a minute. All the above deals evidence the fact that there was a matching of the buy and the sell quantity and the buy and the sell price. This proximity in the placing of orders at the same price and for the same quantity, resulted in getting them matched, indicates that the deals were structured. One could accept it as a coincidence in case of a solitary incident or two. However the same happened regularly thoroughout in investigation period. The continuous regularity with which these brokers were counter-parties, leads one to conclude, that these transactions were structured and synchronised. The structured nature of trades is evidenced by the exact matching of price and quantity of shares, resulting in the matching of trades almost on every occasion between themselves, even when there were few thousand investors spread over more than 300 cities in the country. Frequency of such trades ensured consistent matching of the orders, where one entity got themselves as the sellers and vice versa. It is clear that the buy and sell orders were matched at the same price, purely for the purpose of projection of the volumes of the shares of SIL in a way (which were not market determined volumes), to induce other persons to invest in the said scrip.

    27. Further, the contention of the Noticee that the main broker is responsible for the manipulation is not tenable. The Noticee is registered with SEBI as a sub-broker and should have followed the regulations and code of conduct applicable for them. They futher submitted that they were unaware of the trade matching. The trading pattern of the Noticee shows that their orders had always matched with the counterparty orders and this can not be possible unless there was a predetermined arrangement to place the order. The buy and sell prices of Noticee were close to the buy/sell rates of the counterparties in the trades reflected in the tables above. The number of matched trades of the Noticee were quite high and the repeated matched trades can not be treated as mere coincidence. The essence of screen based computerized trading is that it enables investors to transact in a fair and transparent manner. This mechanism is also meant to ensure matching of the orders through the impersonal screen, on the basis of price time priority wherein the sellers realizes the true price of their securities within the circuit filters determined by the excahges from time to time. It is possible for even structured transactions to be executed on the screen of the exchange, at the price and order matching mechanism of the exchange.

    28. In the present case, the Noticee facilitated their clients to execute the trades on the screen of the exchange as per their prior understanding. Further, the argument that the identity of the other trading client in such cases was not known to each other can not be accepted if one considers the frequency of the trades and the perfect matching of the quantity and price and their trading pattern. One or two deals on the exchange could be synchronized or structured as a matter of chance, but trades to the extent of such large volumes, involving crores of rupees in all repeating again and again over a period of time can not be mere coincidence and points to manipulative intend of the entities trading.

    29. The clients of the Noticee were trading mostly in this particular scrip and the pattern of his trading was suspicious. The nexus of the clients of the Noticee with SIL has been clearly established in the paragraphs above. Further, the consistent matching and reversal of orders by the Noticee goes to prove its knowledge of manipulation. The stock market system depends a lot on prudence of the intermediaries. The brokers/subbrokers are the first line of monitoring and surveillance in the market. The failure at this level weakens the fundamentals of the system and harms its development as a safe market of international standards. In the instant case, the Noticee did not exercise due skill and diligence expected from it and failed to take any action even though there were enough indications suggesting clearly that the trading in the scrip by the clients was not bonafide. Further, instead of taking corrective action against the suspicious dealings of his clients, the Noticee allowed the clients to continue creating artificial market by executing repeated matched, synchronised and cross deals for the clients.

    30. In view of what has been explained herein above, I find that the Noticee misused the stock exchange mechanism by executing manipulative trades in the nature of structured and reversal trades on behalf of the clients closely related to the management of SIL during the period of price manipulation. I also find that the price and volumes in the scrip increased manifold and this type of artificial volume gives wrong message to the investors and induces them to trade in the shares. These trades abetted in creating artificial volumes and false market in the SIL scrip and are in violation of the provisions of Regulation 4(a) and (b) of PFUTP Regulations which are extracted under:

    4. No person shall

    (a) effect, take part in, or enter into, either directly or indirectly, transactions in securities, with the intention of artificially raising or depressing the prices of securities and thereby inducing the sale or purchase of securities by any person;

    (b) indulge in any act, which is calculated to create a false or misleading appearance of trading on the securities market;

    31. In the process of perpetuating these artificial trades, Noticee had also failed to exercise proper skill, care and diligence, required of a sub-broker. By indulging in the aforesaid acts, Noticee did not maintain required standards of integrity, promptitude and fairness expected of a sub-broker. The Noticee has thus violated the provisions of Clause A(1) & (2) and D(4) & (5) of code of conduct specified under Regulation 15(1)(b) of SEBI (Stock Brokers and Sub-brokers) Regulations, 1992 which states as under:

    A. GENERAL

    (1) INTEGRITY: A sub-broker, shall maintain high standards of integrity, promptitude and fairness in the conduct of all investment business.

    (2) EXERCISE OF DUE SKILL AND CARE: A sub-broker, shall act with due skill, care and diligence in the conduct of all investment business.

    D. SUB-BROKERS VIS-À-VIS REGULATORY AUTHORITIES.

    (4) MANIPULATION: A sub-broker shall not indulge in manipulative, fraudulent or deceptive transactions or schemes or spread rumours with a view to distorting market equilibrium or making personal gains.

    (5) MALPRACTICES: A sub-broker shall not create false market either singly or in concert with others or indulge in any act detrimental to the public interest or which leads to interference with the fair and smooth functions of the market mechanism of the stock exchanges. A sub-broker shall not involve himself in excessive speculative business in the market beyond reasonable levels not commensurate with his financial soundness.

    32. I have noted that the enquiry officer has recommended imposition of a penalty of suspension of the certificate of registration of the Noticee as sub-broker for a period of four months. In the facts and circumstances of the case, I am inclined to agree with the recommendation of the Enquiry Officer.

    33. Taking into consideration all facts and circumstances of the matter and in exercise of the powers conferred upon me in terms of Section 19 of the Securities and Exchange Board of India Act, 1992 read with Regulation 13(4) of Securities and Exchange Board of India (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002, I hereby impose a penalty of suspension of certificate of registration issued to the sub-broker, Compuaction Securities Private Ltd. (SEBI Registration no. INS010579238 and PAN No. AAACC3877 C) for a period of four months.

    34. This order shall come into force on the expiry of 21 days from the date of this order.

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    Comments

    Compuaction Securities Private Ltd., In Re (Failure To Exercise Due Diligence)
    (Feb 7, 2008)