Sebi allows some relaxation to barred entity

Regulator Sebi has allowed certain relaxations to an entity that was barred along with 128 others from the securities market in April this year for suspected tax evasion and laundering of black money through stock markets.
Mishka Finance and Trading Ltd along with 128 other entities were restrained from the securities market till further orders.
Among them, one individual -- Manharlal Narottamdas Shah (noticee) -- has been provided some relaxations following an appeal filed by him.
Sebi's Whole Time Member Rajeev Kumar Agarwal today said the purpose of the interim order was to restrain the noticee from indulging in similar activities of misuse of the stock exchange mechanism for purposes other than genuine trading.

The interim order, passed in April this year, had barred the noticee from securities market till further directions.
"This is a special type of case where several entities have been restrained on the basis of prima facie findings. The facts of this case are complex and entail examination of various transactions in shares under investigation.

"I am of the view that certain relaxations within the spirit of order dated September 9, 2015 passed by SAT so as to avoid any irreparable loss to the noticee may be given without compromising with the purpose and effect of the interim order," Agarwal noted.

On an appeal by Shah, the Securities and Appellate Tribunal (SAT) in September had asked the regulator to pass an order within six weeks.
Sebi has now permitted Shah to subscribe to mutual fund units as well as avail the benefits of corporate actions like rights issue, bonus issue, stock split and dividend.
Besides, Shah has been allowed to sell securities lying in their demat accounts as on the date of the interim order other than the shares of the companies which are suspended from trading by the concerned stock exchange.
The sale proceeds are to be deposited in an interest bearing escrow account with a nationalised bank.

As per Sebi's interim order in April, the 129 entities were estimated to have shown fictitious capital gains to the tune of Rs 254 crore and just 29 of them made unlawful gains to the tune of Rs 92 crore on an investment of just Rs 2 crore.