SAT reduces penalty on an individual in Hit Kit Global case

Securities Appellate Tribunal has upheld Sebi order against an individual but has reduced the fine imposed on him by the market regulator from Rs 10 lakh to Rs 7 lakh in a case related to fraudulent dealings in shares of Hit Kit Global Solutions.
However, SAT has asked the individual, Sanjay Jethilal Soni, to pay the penalty within six weeks failing which the original fine of Rs 10 lakh will be re-imposed.
The Securities and Exchange Board of India (Sebi) in October 2011 had imposed a penalty of Rs 10 lakh on Sanjay Jethilal Soni for indulging in synchronised trades along with a group of entities in the shares of Hit Kit Global Solutions.

Subsequently, Soni had approached SAT challenging Sebi ruling in the case.
Upholding Sebi's findings, SAT in an order dated August 20 said: "that similarly situated certain persons, who had also indulged in the manipulative synchronised trades in question, have been imposed lesser punishment though they had traded enormously in the same scrip".
SAT noted that other entities who transacted in Hit Kit Global Solutions shares were imposed with "an average penalty of Rs 6.30 lakh" by Sebi.

Keeping in view the limited role of Soni in the matter, SAT said that "the monetary penalty of Rs 10 lakh is modified to Rs 7 lakh to be paid by the appellant within a period of six weeks from the date of receipt of this order failing which original penalty of Rs 10 lakh would revive".

The matter relates to Sebi probe into the trading of scrip of Hit Kit Global Solutions for a period between October 1, 2004 to January 12, 2005.
It was noticed that the firm's promoter Eaugu Udyog had offloaded its shares in the market when the company was making good profit.
While the prompter was offloading shares in the market, it was found that the major counter party clients were a group of connected entities including Soni.
Sebi probe had found that Soni had along with the group of entities indulged in synchronised trades, among others.