Adjudication Order in respect of Shri Alpesh Shah in the matter of Aadhaar Ventures India Ltd

BEFORE THE ADJUDICATING OFFICER
SECURITIES AND EXCHANGE BOARD OF INDIA
[ADJUDICATION ORDER NO. Order/KS/AE/2020-21/9194]

UNDER SECTION 15-I OF THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 READ WITH RULE 5 OF SEBI (PROCEDURE FOR HOLDING INQUIRY AND IMPOSING PENALTIES) RULES, 1995

In respect of:
Shri Alpesh Shah (PAN : AEAPS0393A)

In the matter of Aadhaar Ventures India Ltd

BACKGROUND

1. Securities and Exchange Board of India (hereinafter referred to as ‘SEBI’) carried out investigations in the trading activity in the scrip of Aadhaar Ventures India Ltd (hereinafter referred to as ‘AVIL’) during the period January 1, 2009 to April 24, 2015 (hereinafter referred to as ‘Investigation Period’). In the aforesaid investigation period, it was observed that during one of the patch extending from August 02, 2011 to December 30, 2011 the price in the scrip fell from Rs. 77.50 to Rs. 0.66 i.e., a fall of 99.15%. Investigations revealed that the entity namely, Shri Alpesh Shah (hereinafter referred to as ‘Noticee’) was the major contributor to negative LTP (Last Traded Price) during this price fall patch. It was also observed that the Noticee had executed self trades at a rate lower than the last traded price and contributed to negative LTP. Further, it was observed that the Noticee in several instances had placed sell orders for 1 share at a rate lower than the last traded price, inspite of the fact that buy orders were existing for a larger quantity and contributed to negative LTP. Thus, it was alleged from the Noticee’s trading pattern that it was not acting as genuine seller and had no bona fide intention to sell in-spite of buy orders with abundant quantity at a higher price being available in the market. Through such transactions, it was alleged that the Noticee was instrumental in establishing a price lower than the last traded price and thus contributed to fall in scrip price with each of his trades. In view of the same, it was alleged that Noticee manipulated the price of AVIL and created a misleading appearance of trading in the scrip, and adjudication proceedings was initiated against the Noticee for alleged violations of Regulations 3(a), 3(b), 3(c), 3(d), 4(1), 4(2)(a), and 4(2)(e) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’).

APPOINTMENT OF ADJUDICATING OFFICER

2. The undersigned was appointed as the Adjudicating Officer (AO) by SEBI vide Order dated December 15, 2017 under Section 15-I of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as ‘SEBI Act’) and Rule 3 of SEBI (Procedure for Holding Inquiry and Imposing Penalties) Rules,1995 (hereinafter referred to as ‘Rules’) to inquire into and adjudge under the provisions of Section 15HA of SEBI Act the aforesaid violations alleged to have been committed by the Noticee.

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