The Securities Appellate Tribunal (SAT) has rejected a plea by Grishma Securities seeking a review of its order upholding Sebi's ban on the stock broker and its executives for fraudulent trade practices.
The case relates to manipulation in the share price of Tijaria Polypipes on its debut in the stock market in 2011.
SAT on October 28, 2013, upheld Sebi's order that barred Grishma Securities, its CEO Mihir Ghelani, Managing Director Ketan Shah and directors Chandrika H Gandhi and Chhabil C Shah from the capital market for five years for fraudulent trading.
In its review plea, Grishma and its executives argued that when the restraint order against its client (Chetan Dave) and other brokers in the matter had been revoked by Sebi, "there was no reason to continue the long-drawn restrain order against appellants (Grishma and its directors)."
On April 23, SAT said that all cases relied upon by Grishma Securities "have been dealt with and distinguished" in its order of October 28, 2013.
"...The grievance of the appellants that in the impugned order there is no rational or justification in distinguishing the case of appellants with other brokers or the case of Chetan Dave cannot be sustained," it added.
Sebi began a probe after noticing a steep fall in the share price of Tijaria Polypipes on the day of its listing on the bourses on October 14, 2011.
The regulator found that Tijaria, through layered transactions, had diverted a part of its initial public offer proceeds to offset losses sustained by certain entities who bought the scrips at a premium to the issue price.
Grishma Securities was found to have acted as a stock broker for two individuals, including Dave, who traded on the listing day of Tijaria and had manipulated the market and induced gullible investors to invest in the shares.
