12 February 2010
The Supreme Court (SC) upheld the market regulator
SEBI’s order banning the Bhansali group from trading
in the securities market for three years on charges
of depriving genuine retail investors from allotment
of Nissan Cooper Ltd’s shares in 2006.
SEBI had alleged that the group by filing multiple applications
had cornered shares of more than their entitlement from the
quota meant for retail investors in Nissan’s IPO.
A Bench headed by Justice SH Kapadia while dismissing all
the 18 petitions filed by the family members came down heavily
on the group for its fraudulent conduct.
“How can 426 application can be filed by one person.
How will demat work? You have played fraud and you
have now guts to come here,” the court observed.
Bhansalis,’ who claim to have wide interests ranging from
bullion trading to securities, have challenged the Securities
and Appellate Tribunal’s judgment that dismissed their
petitions against the SEBI’s ban imposed on them for
violating Regulation 3(a) and (c) of SEBI (Prohibition
of Unfair Trade Practices relating to Securities Market)
Regulations 2003.
The tribunal while imposing cost of Rs 50,000
on the group had upheld SEBI’s findings that
the family had indulged in unfair trade practices and
had fraudulently managed to get allotment of more than
their entitlement in the IPO.
The petitioners have accepted that they had filed
29 applications in the IPO of Nissan Cooper Ltd in
December 2006, but denied having given wrong details
intended to avoid weeding out as alleged by the market
regulator. Besides, they said that it had sold 6,877
allotted shares and the sale had not resulted in any
manipulation in the scrip
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