Sebi has asked its investigation department to examine the feasibility of quantifying ill gotten gains made by Vital Communications Ltd by way of preferential allotment of shares through a fraudulent scheme.
In his order related to the case, Sebi Whole Time Member Rajeev Kumar Agarwal has directed the Investigations Department (IVD) "to examine the feasibility of quantifying the ill gotten gains, if any, and issue the requisite notice for disgorgement of the same within three months".
The restitution, on merits, in the case of the complainants, should also be considered by the department in accordance with Sebi norms, the order, dated December 16, said.
The capital market regulator, in its July 31 order, had found that a scheme was devised by the promoters and directors of Vital Communications to make fraudulent gains.
The scheme of things started with preferential allotment during December 1999 to 15 entities which were connected to VCL, its promoters and directors and subsequent sale of shares by these entities in the market during May-July 2002. Then the sale proceeds went to the accounts of promoters and their companies.
Sebi had also said these were "carried out as a devise to enable fraudulent gains to the promoters and directors".
However, the complainants -- Ram Kishori Gupta and Harish Chandra Gupta -- approached the Securities Appellate Tribunal with some additional prayers.
Sebi's latest order follows the tribunal's directions.
In the latest order, Agarwal said that no person can be allowed unjust enrichment by way of wrongful gain made on account of fraudulent, manipulative and unfair trade practices.
"I, however, find that in the instant case, the ill- gotten gain, if any, made by the persons/entities mentioned in the Sebi order dated July 31, 2014 had not been quantified during the investigation and therefore, the same was not considered in the aforesaid order," he noted.
