SEBI confirms ban against India Capital

“The preliminary findings of the investigation had revealed that the stock broker (India Capital) had traded shares of PSTL during the relevant period for its clients,including Nirmal Kotecha,Raju G Shah and Amol Kokane,” the Securities and Exchange Board of India (SEBI) said in its order.

In its objection filed with SEBI on May 22,2009,the stock broker submitted that “its trading in the three time slots in both the stock exchanges did not constitute a significant position,especially in the first time slot when Nirmal Kotecha had offloaded the largest portion of his stake.”

While rejecting the plea of India Capital,Sebi said,”It would not be appropriate to revoke the interim direction issued against the India Capital vide the order till further orders.”

In an interim order in the PSTL case in April,2009,Sebi had banned over 220 persons and entities from trading in securities.

The case pertains to manipulation of PSTL shares by another promoter,P Saminathan,with assistance from different market intermediaries,to amass unlawful gains.

Saminathan is also alleged to have forged a Sebi letter that reportedly allowed PSTL to make an open offer for an additional 20 per cent stake in the company.