G.N.Bajpai, - (1.) THE Securities and Exchange Board of India (hereinafter referred to as SEBI) initiated investigation proceedings against Shri Ketan Parekh and some entities associated with him and also in respect of the pay-in-defaults by some brokers of Calcutta Stock Exchange (hereinafter referred to as "CSE") including Shri DK Singhania. During the course of investigation, it was observed that Shri DK Singhania has indulged in large volumes off market transactions which are in violation of provisions of the Securities Contracts (Regulation) Act, 1956, SC(R) Act (1956) and the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995.
(2.) Pending the investigation a show cause notice dated 21.8.2002 was issued to Shri DK Singhania, calling upon him to show cause as to why appropriate directions under sections 11 and 11B of the SEBI Act, 1992 should not be issued restraining Shri Singhania from trading or dealing in securities market pending completion of investigations. An opportunity of hearing was also given on 3.9.2002. At the request of Shri Singhania, the date of reply to the show cause notice was extended and the date of hearing was adjourned to 25.9.2002 by SEBI's letter dated 3.9.2002. It was made clear no further opportunity to submit reply or hearing would be given. Reply of Shri DK Singhania Shri Singhania vide his letter dated 12.9.2002 submitted his reply to the show cause notice. However, Shri Singhania did not attend the hearing on 25.9.2002 nor did he communicate to SEBI in this regard. Therefore, I proceed further based on the material available on record. The major contentions raised in the reply are as follows:
(3.) THE basis of the arriving at a conclusion that he had indulged in huge volumes of transactions in 5 major scrips with the Poddar Group, Biyani Group and other entities of Singhania Group has not been indicated.;