SAT upholds SEBI move to impose penalty on five people

MDT/PTI 09 November 2012

SEBI found that 10 entities including the five individuals transferred or received shares in off-market transactions in respect of 70.78 lakh shares of Indo Pacific Software and Entertainment

Mumbai: The Securities Appellate Tribunal (SAT) upheld Securities and Exchange Board of India (SEBI)'s move to impose penalties on five individuals for indulging in off market transactions in shares of Indo Pacific Software and Entertainment Ltd and not furnishing necessary information to the regulator, reports PTI.

In a common order issued against the five individuals, SAT has upheld SEBI's penalty of Rs 3.50 lakh each on -- Bharat Shantilal Thakkar, Kishore Balubhai Chauhan, Hemant Madhusudan Sheth, Prem Mohanlal Parikh and Bhavesh P Pabari -- for failing to appear before SEBI and provide the required information as per summons issued.

Further, SAT upheld the fine of Rs3 lakh on Pabari, Rs2 lakh each on Sheth and Parekh and and another Rs1.50 lakh each on Thakkar and Chauhan for indulging in off market deals in scrip of Indo Pacific Software and Entertainment, a notification said.

SAT noted that the five entities were found to have entered into certain transactions which were 'prima facie undesirable' and 'for which no proper explanation was offered' by them, the notification added.

The matter relates to a probe in the trading in the scrip of Indo Pacific Software and Entertainment that is into providing software development, entertainment activities, among others.

The regulator found that 10 entities including the five individuals transferred/ received shares in off-market transactions in respect of 70.78 lakh scrips of the company.

The entities were directed by SEBI to explain the circumstances leading to the off market transfers to which they submitted that the transactions were in the nature of repayment of old loans, advancement of new loans.

Thereafter investigating authority of SEBI called for specific details regarding the alleged off market transfers, the notification said.

However, after a series of correspondence asking for information the investigating officer concluded that the queries raised during the investigation were not answered fully by the appellant and there was default in responding to the summons issued by the authorities, it added.

SEBI had also alleged that the entities had failed to furnish evidence for the off market transfers as contended by them.

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