Sebi settles cases with two entities in matter of Dalal Street Investments

Markets regulator Sebi Monday settled cases of alleged disclosure lapses by two entities in the shareholding of Dalal Street Investments after they paid over Rs 37 lakh towards settlement fees.

According to two separate orders, the entities S M Sheti Seva Pvt Ltd and Resham Resha Pvt Ltd had paid settlement fee of over Rs 19.2 lakh and over Rs 18.9 lakh, respectively.

The Securities and Exchange Board of India (Sebi) conducted a probe between September 2008 to July 2009 for alleged irregularity in the dealings of Dalal Street Investments.

The regulator observed that the shareholding of the entities had increased in the company, making it necessary for them to make disclosures as required under SAST (Substantial Acquisition of Shares and Takeover) Regulations and PIT (Prohibition of Insider Trading) Regulations.

However, while the adjudication proceedings were in progress, the entities filed application with the regulator to settle the case.

Under settlement provisions, an entity is allowed to settle charges by paying a penalty without admission or denial of guilt.

The settlement terms proposed by the entities were considered by Sebi's High Powered Advisory Committee (HPAC). The committee recommended the cases for settlement on payment of Rs 19,28,804 by S M Sheti Seva and Rs 18,96,990 by Resham Resha.

The recommendation of HPAC was approved by the panel of Whole Time Members of Sebi.

Separately, the regulator has slapped a total fine of Rs 12 lakh on two individuals for engaging in fraudulent trading in the shares of Pressman Advertising Ltd.

The two individuals-- Nupur Agarwal and Amit Kumar-- were part of a group of 29 entities that allegedly indulged in execution of reversal trades through a combination of on-market and off-market transactions which led to artificial volume, thereby creating a false and misleading appearance of trading in the scrips, Sebi noted.

The two individuals indulged in reversal of trades in the scrip of the company and thereby created artificial volumes and misleading appearance of trading without any intention of change of beneficial ownership of security, Sebi said in two separate but similarly worded orders.

By doing such trades the individuals have violated PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.

Accordingly, the individuals have been fined Rs 6 lakh each.