SAT rejects review petitions of two persons in Ojas case

The Securities Appellate Tribunal today rejected review applications of two individuals against an order of the tribunal wherein it had directed surrender of unlawful gains of Rs 60.72 lakh, made by each one of them, through fraudulent trading activities.

In October, last year, SAT had upheld Sebi's order against, Shailesh S Jhaveri and Harsha M Shah, that had asked them to disgorge unlawful gains of Rs 60.72 lakh made through fraudulent trading in shares of Ojas Technochem Products Ltd.

However, the tribunal had partially modified Sebi's order by ruling that Jhaveri and Shah need not pay Rs 75.31 lakh each -- based on simple interest of 12% per annum -- on the unlawful gain for the period January, 2000 to May, 2010 as directed by the market regulator.

In their review applications, Jhaveri and Shah had submitted that "the tribunal instead of considering all contentions raised and argued, has considered only five contentions", among others.

SAT in its order today noted that arguements posed by both the individuals "does not merit consideration in these review applications, because, in order dated October 4, 2012, each argument canvassed by appellants before the tribunal have been specifically set out."

Accordingly SAT said: "When factual scenario is examined  in the background of legal principles set out...The inevitable conclusion is that these review applications sans any merit and are liable to be rejected".

Sebi had found that the two individuals got preferential allotment of 6 lakh shares each of Ojas Technochem Products without actual infusion of funds by them as consideration.

The two sold these shares subsequently at an average price of Rs 10.12 apiece making illegal profit of Rs 60.72 lakh each. This, according to Sebi was violation of the provisions on prohibition of fraudulent and unfair trade practices.