Prudential Stock: Sebi penalty upheld

“We are not convinced with this argument either. While deciding the quantum of penalty,the adjudicating officer (of Sebi) has given due consideration to the factors and has imposed penalty within the limits prescribed under the relevant sections which prescribe penalty,” SAT said.

The Tribunal also observed that Prudential Stock & Securities,which invests in securities of listed and unlisted companies,was not been cooperative,as it neither submitted a proper reply to the show cause notice nor did it respond to the summons issued by Sebi.

“In the facts and circumstances of the case,no interference is called for even on the quantum of penalty imposed by the adjudicating officer,” SAT order said.

Sebi had taken action against the company,through an order passed in October 2011,after its probe found that it had got 20 lakh shares or 19.70 per cent stake of Gennex Laboratories in May 2006 without making mandatory disclosures under the takeover regulations.

According to Sebi,Prudential Stock had got these shares from Global Telenet Ltd in an off-market transaction and later it sold 9,336 shares on June 7,2006 and another 20,02,700 shares on June 14,2006 to Mercury Fund Management.

Sebi probe,which found Prudential Stock to have violated insider trading regulations as well,was initiated after a significant change was noticed in promoter holding of Gennex Lab from 53.62 per cent to 24.72 per cent between April 2007 to December 2007.