The Securities Appellate Tribunal (SAT) today set aside the penalties imposed by market regulator Sebi on infrastructure major Jaiprakash Associates' Chairman Manoj Gaur and his two family members in a case of alleged insider trading in the company's shares. After hearing the appeals by Jaiprakash Associates Executive Chairman Manoj Gaur,his wife Urvashi Gaur and brother Sameer Gaur against a Sebi order imposing penalties of Rs 10 lakh each,SAT today said that there were not enough evidences to prove the charges. After a probe into the dealings of shares during the period September 29,2008 to October 27,2008,Sebi had found them guilty of norms related to insider trading,as it charged Urvashi and Sameer Gaur of trading in the stock on the basis of 'unpublished price sensitive information' relating to financial results of the company shared by Manoj Gaur. However,SAT upheld the penalties of Rs 10 lakh each against three other entities - the company's Whole Time Director S D Nailwal,Company Secretary and Compliance Officer Harish K Vaid,and Vaid-headed HUF (Hindu Undivided Family). Sebi had alleged that these entities had also traded in the company's shares on the basis of Unpublished Price Sensitive Information (UPSI) relating to financial results for the quarter ending September 30,2008. All the entities,on whom Sebi had imposed penalties,had approached the tribunal to appeal against the order. ".the Board (Sebi) has not brought any evidence on record,direct or circumstantial,to show that he (Manoj Gaur) had passed on this information to either Urvashi Gaur or Sameer Gaur or that the trading done by Urvashi Gaur on October 13,2008 or Sameer Gaur on October 13,14 and 16,2008 was based on UPSI," SAT said in its order. The SAT further observed that the quantity of shares traded by Sameer Gaur and Urvashi Gaur was too small and they were regularly trading in the shares of Jaiprakash Associates as well as some other companies. "Looking at the trading pattern,the number of shares purchased and going by their status,it seems highly improbable that trading was done by them on the basis of UPSI. "On the other hand,it is more probable that they traded in the normal course of business. If the intention of Urvashi Gaur and Sameer Gaur had been to capitalise on the UPSI allegedly communicated by Manoj Gaur,the quantum of purchase would not have been so small," SAT said. "We,therefore,set aside the impugned order and allow In its order on appeals by Vaid,his HUF and Nailwal,the tribunal observed that the entities have not been able to prove that the trading was not done on the basis of USPI. "We,therefore,cannot find any fault with the findings arrived at by the adjudicating officer," SAT noted.
