PFUTP Regulations:
3. Prohibition of certain dealings in securities
No person shall directly or indirectly
(a) buy, sell or otherwise deal in securities in a fraudulent manner;
It is noted that in ASE, the scrip of Monalisa was illiquid as there was no trading
reported in the said scrip during the period December 1, 1999 to September 18, 2000.
Subsequently, the scrip gained momentum during the period September 19, 2000 to
Page 3 of 9
September 29, 2000 when the Noticee and the other connected entities traded in the
scrip.
9. It is noted that investigation also revealed that the Noticee Mr. Tushar Jhaveri, Mr.
Sanjay R. Shah, Orbit Securities Ltd., Classic Consultancy and Mr. Sanjiv Pravinchandra
Shah are linked to each other as Mr. Sanjay R. Shah and Mr. Rajiv R Shah (Proprietor of
Classic Consultancy) share the same address and there was substantial amount of share
transfer from the Noticee to other entities. The details are as under:
i.
On September 21, 2000 and September 23, 2000, the Noticee transferred
3,00,000 shares of Monalisa to Mr. Sanjay R. Shah having address at E-101,
Shubhalaxmi Tower, Opp. Sanghavi High School, Naranpura, Ahmedabad 380
013.
ii.
iii.
iv.
On October 10, 2000, Mr. Sanjay R Shah transferred 1,00,000 shares to Mr.
Sanjiv P Shah.
10. During the investigation period i.e. from September 19, 2000 to September 29, 2000, the
price of the scrip of Monalisa at ASE opened at ` 28/- on September 19, 2000 and
closed at `39.90 on September, 2000, thereby registering an increase of price to the tune
of 39%.
The following are the settlement wise details of transactions done by the entities:
Date
Sett
No.
19/9/00
52
Buy Details
Name of ASE Name of
broker
client
Buy
Qty
Name
broker
Hemant Jhaveri
Tushar
Jhaveri
15000
Prerak Capital
Sanjay
R.Shah
10000
Ashok C. Shah
Page 4 of 9
of
Sell Details
ASE Name
client
Sanjay
R.Shah
of
Sell Qty
32500
Total no
of shares
traded at
ASE
32500
Date
Sett
No.
20/9/00
53
Buy Details
Name of ASE Name of
broker
client
Buy
Qty
Name
broker
Hemant Jhaveri
Tushar
Jhaveri
20000
Prerak Capital
Sanjay
R.Shah
40000
Total no
of shares
traded at
ASE
40000
Sanjay
R.Shah
Sanjay
R.Shah
20000
75000
Prerak Capital
Sanjay
R.Shah
60000
95000
Tushar
Jhaveri
Sanjay
R.Shah
15000
35000
42000
Ashok C Shah
Sanjay
R.Shah
Sanjay
R.Shah
Rajendra
Chudgar
Sanjay
R.Shah
25000
Sanjay
R.Shah
19000
Hemant Jhaveri
Tushar
Jhaveri
Sanjay
R.Shah
20000
15000
33000
Ashok C Shah
Tushar
Jhaveri
Orbit
Securities
Sanjay
R.Shah
15000
Rajendra Chudgar
Paresh Shah
Sanjay
R.Shah
35000
Ashok C. Shah
Sanjay
R.Shah
15000
Tushar
Jhaveri
Sanjay
R.Shah
8000
Paresh Shah
Sanjay
R.Shah
22600
Rajesh N.
Jhaveri
Prop A/c
17500
Ashok C. Shah
Sanjay
R.Shah
16000
Paresh Shah
Sanjay
R.Shah
Sanjay
R.Shah
11000
Sanjay
R.Shah
5000
Ashok C. Shah
Paresh R. Shah
21/9/00
54
22/9/00
55
Hemant Jhaveri
Paresh Shah
25/9/00
56
Paresh R. Shah
Rajendra
Chudgar
26/9/00
57
Hemant Jhaveri
27/9/00
58
28/9/00
59
29/9/00
60
Rajendra
Chudgar
Paresh Shah
Rajendra
Chudgar
of
Sell Details
ASE Name
client
Hemant Jhaveri
of
Sell Qty
52000
33000
87000
58000
15000
Sanjay
R.Shah
Aloni Ent.
55000
105000
Prerak Capital
49900
Orbit
Securities
30000
Aloni Ent.
80000
Sanjay
R.Shah
20000
Classic Cons
11000
11000
Classic Cons
80000
95000
141000
Ashok C. Shah
75000
Page 5 of 9
Khandwala
Finstock
Khandwala
Finstock
11. From the above transactions for the nine days at ASE , it is evident that almost the entire
trades at ASE during the said period were accounted by the Noticee Mr. Tushar Jhaveri
and Mr. Sanjay R Shah and other entities connected with them viz., Classic Consultancy,
Orbit Securities Ltd. and Mr. Sanjiv Pravinchandra Shah. It is noted that in most of these
transactions the same person or entity was appearing on buy and sell sides for the same
transactions through different brokers. It was also noticed that one Aloni Enterprise sold
the shares of Monalisa through broker Rajesh Jhaveri Stock Brokers Pvt. Ltd.
12. It was also observed that similar kind of trading activity was noticed at BSE too, during
the period September 25, 2000 to October 13, 2000. The Noticee and Mr.Sanjay R Shah
executed most of the trades in BSE during this period.
The details of transactions of Mr.Tushar Jhaveri and Mr.Sanjay R Shah are given below:
Date
Sett
No.
25/9/00
126
27/9/00
128
Buy Details
Name of Name
broker/su of client
b-broker
Buy
Qty
Sell Details
Name
of Name of Sell Qty
broker/sub client
-broker
Total
shares
traded
in the
market
52200
Galaxy
Broking
Tushar
Jhaveri
15000
Prabhudas
Liladher
through Jyotish
Bhogilal
Sanjay R.
Shah thru
Shree
Parshawa
Finance/
Rajesh
Jhaveri
28250
SKSE Sec
through subbroker
Amrut Sec
Sanjay R.
Shah/Tus
har Jhaveri
2500
Prabhudas
Liladher
through Jyotish
Bhogilal
Rajesh
Jhaveri thru
Shree
Parshawa
Finance
225
SKSE Sec
through subbroker
Amrut Sec
Sanjay R.
Shah/Tus
har Jhaveri
15000
Prabhudas
LiladherJyotish Bhogilal
Rajesh
Jhaveri thru
Shree
Parshawa
Finance
10763
Galaxy
Broking
Tushar
Jhaveri
10000
Page 6 of 9
45600
28/9/00
29/9/00
129
130
Galaxy
Broking
Tushar
Jhaveri
23900
SKSE
Securities
through subbroker
Amrut Sec
Sanjay R.
Shah/Tus
har Jhaveri
2500
SKSE
Sec
through subbroker
Amrut Sec
Sanjay R.
Shah
/Tushar
Jhaveri
10000
Sanjay R.
Shah
/Tushar
Jhaveri
Tushar
Jhaveri
46000
Tushar
Jhaveri
5/10/00
133
SKSE
Sec
throgh subbroker Anil
Gandhi
Galaxy
Broking
6/10/00
134
Galaxy
Broking
Prabhudas
Lila/Jyotish
Bhogilal
Rajesh
Jhaveri thru
Shree
Parshawa
Finance
3000
Lalkar Sec
Tushar
Jhaveri thru
Enpee
Securities
30000
Acme Shares
Tushar
Jhaveri thru
Mahavir
Inv
25300
81218
3100
Galaxy Broking
Tushar
Jhaveri
100
19610
11950
Galaxy Broking
Tushar
Jhaveri
100
54001
Lark Consul
Sanjay
R.Shah
Sanjay R.
Shah
19480
Tushar
Jhaveri
Lark Consul
135
Galaxy
Broking
53650
9/10/00
10/10/00
136
Galaxy
Broking
Tushar
Jhaveri
10450
Lark Consul
11/10/00
137
Galaxy
Broking
Tushar
Jhaveri
69600
12/10/00
138
Galaxy
Broking
Tushar
Jhaveri
19000
13/10/00
139
Galaxy
Broking
Tushar
Jhaveri
55000
60710
50000
119425
Sanjay
R.Shah
28600
90027
Lark Consul
Sanjay R.
Shah
37220
106692
Galaxy Broking
Tushar
Jhaveri
2000
30200
Prabhudas
Lila/Jyotish
Bhogilal
Sanjay R.
Shah thru
Shree
Parshawa
Finance/
Rajesh
Jhaveri
Sanjay R.
Shah thru
Shree
Parshawa
Finance/
Rajesh
Jhaveri
6100
Prabhudas
Lila/Jyotish
Bhogilal
Page 7 of 9
25548
92598
13. The abovementioned transactions clearly show that the Noticee along with Mr.Sanjay R.
Shah, Orbit Securities Ltd., Classic Consultancy and Mr. Sanjiv Pravinchandra Shah sold
the shares of Monalisa through various brokers of ASE/BSE and simultaneously
purchased shares through other brokers at ASE/BSE. These were circular in nature and
the pattern of trading clearly reveals the intention to create artificial market in the scrip at
ASE and BSE. It is also noted that shares sold by the Noticee Mr. Tushar Jhaveri and
Mr. Sanjay R. Shah were routed through Rajesh N. Jhaveri/Mr. Piyush Jhaveri
(proprietor of Shree Parshawa Finance) in a circuitous manner in order to avoid
detection and to create artificial volume in the scrip. It was observed that the Noticee
and Mr. Sanjay R. Shah had defaulted in making payments to their brokers Amrut
Securities Ltd., Mr. Anil Gandhi (on October 06, 2000) and Galaxy Broking (on October
16, 2000) for the large purchases in the scrip.
14. It is noted that the Investigating Authority of SEBI vide summons dated February 05,
2003 and March 03, 2003 required the Noticee to produce documents and to appear
before him. However, the Noticee failed to respond to the summons and also failed to
appear before the Investigating Authority.
15. In view of the facts and circumstances of the case and considering the fact that the
Noticee did not refute any of the transactions stated above, I find that the Noticee Mr.
Tushar S. Jhaveri has executed circular trades with an intention to create artificial market
in the scrip at ASE and BSE and thereby violated the provisions of Regulation 4(b), 4(d)
and 6(a) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to
Securities Market) Regulations, 1995 read with Regulations 3(a), 4 (1), 4 (2) (a), (b) & (g)
SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities
Market) Regulations, 2003.
16. It is pertinent to mention here that proceedings under Section 11 and 11B of the SEBI
Act were initiated against Mr. Sanjiv Pravinchandra Shah and Classic Consultancy which
culminated in their debarment for a period of six months vide separate Orders dated
January 09, 2009. Further, the Enquiry proceedings initiated against Orbit Securities
resulted in issuance of warning vide Order dated March 10, 2010 and proceedings
Page 8 of 9
initiated against Mr. Sanjay R. Shah resulted in Suspension of registration certificate for a
period of one month vide Order dated March 10, 2010 issued by SEBI.
It is a material fact that the Noticee Mr. Tushar Jhaveri played an important role in
the manipulation of the scrip of Monalisa during the investigation period by executing
most of the transactions detailed in pages 4-7 of this order.
17. Taking into consideration the facts and circumstances of the case, I, in exercise of the
powers conferred upon me under Sections 19 of the SEBI Act read with Section 11 and
11B and Regulation 11 of SEBI (Prohibition of Fraudulent and Unfair Trade Practices
relating to Securities Market) Regulations, 2003 hereby restrain Mr. Tushar S. Jhaveri
from accessing the securities market and prohibit him from buying, selling or otherwise
dealing in securities, directly or indirectly, for a period of One year.
18. This order shall be served on all recognized stock exchanges and depositories to ensure
that the Noticee is not allowed to undertake transactions as prohibited in Paragraph 17
above.
19. This order shall come into force with immediate effect.
S.RAMAN
WHOLE TIME MEMBER
SECURITIES AND EXCHANGE BOARD OF INDIA
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