 "banks, lending")
The Securities Appellate (SAT) on Monday dismissed appeals of seven entities, including former promoters, against a Sebi order that barred them from the securities market in the case of alleged insider trading in erstwhile Bank of Rajasthan.
Bank of Rajasthan (BoR) has now merged with ICICI Bank.
The regulator's whole-time member (WTM), in November 2017, had barred seven entities from the securities market for five years and directed them to disgorge illegal gains worth over Rs 95 lakh.
The seven entities are -- Rohit Premkumar Gupta, Sanjay Kumar Tayal, Navin Kumar Tayal, Jyotika Sanjay Tayal, Advik Textiles and Realpro Pvt Ltd, Kulwinder Kumar Nayyar and Azam Mohmmed Ashan Shaikh.
According to Sebi, Sanjay Kumar Tayal, Navin Kumar Tayal, Jyotika Sanjay Tayal were the dominant shareholders at the relevant time.
In addition, the tribunal has dismissed the pleas of five entities against an order passed by Sebi's adjudication officer (AO) in May 2020, whereby a penalty totalling Rs 3 crore was levied on them.
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These five entities are -- Rohit Premkumar Gupta, Navin Kumar Tayal, Jyotika Sanjay Tayal, Advik Textiles & Realpro Pvt Ltd and Kulwinder Kumar Nayyar.
In its order on Monday, SAT said, "All the appeals filed against the order of the WTM and against the order of the AO are dismissed with no order as to cost".
To check possible violations of insider trading norms, the regulator had conducted an investigation into the movement of BoR shares from May 7-18, 2010.
This period -- which was before the announcement of an agreement between the dominant shareholders of BoR and ICICI Bank Ltd for a merger -- witnessed considerable price and volume movement.
In its order, Sebi had imposed a five-year ban on the seven entities and also ordered them to "jointly and severally disgorge an amount of Rs 95,77,614... along with interest calculated at the rate of 12 per cent per annum from May 27, 2010, onwards".
Sebi Whole Time Member G Mahalingam had said that he is inclined to believe that Rohit who carried out insider trading was able to do it because of the support received from the Tayals.
It was reiterated that despite the changes in the directorship and shareholding of Advik, the affairs of Advik were effectively controlled by Tayals namely, Sanjay, Jyotika and Navin, he noted.
In its May 2020 order, Sebi had found that Rohit Gupta had traded in the shares of BoR based on unpublished price-sensitive information about the negotiation of the merger between BoR and ICICI Bank.
It was alleged that Gupta was funded by Advik Textiles and its directors Kulwinder Nayyar and Azam Shaikh.
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