SEBI finds HUF among 14,720 entities with non-genuine trades in illiquid stock options

The proceedings were terminated because the HUF ceased to exist as a legal entity before the final decision was made.

Who it concerns: Sanjay S. Achharya HUF (PAN: AAGHA7452L)

What SEBI found or ordered

• SEBI alleged the HUF executed 2 non-genuine reversal trades creating artificial volume of 1,00,000 units in stock options.
• The HUF was alleged to have violated regulations 3(a), (b), (c), (d), 4(1), and 4(2)(a) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003.
• The Karta of the HUF died on September 09, 2015, and the HUF was dissolved on April 10, 2018.
• SEBI found that the Noticee ceased to exist as a legal entity, rendering the proceedings infructuous.
• The adjudication proceedings and the Show Cause Notice dated November 16, 2021, were disposed of without imposing a penalty.

Also in the document

• The order notes that the HUF was one of 14,720 entities found to have executed non-genuine trades during the investigation period (April 1, 2014 to September 30, 2015).
• The Noticee did not apply for the SEBI Settlement Scheme 2022 when it was available.
• The proceedings were disposed of on procedural grounds (non-existence of the entity) rather than a finding of innocence or guilt regarding the trading allegations.