Manoj Gokulchand Seksaria Vs State of Maharashtra (Bombay High Court)
Opening of Demat account in benami name and making large IPO application involves little criminal overtone
Bombay High Court held that dispute between SEBI and petitioner regarding opening of Demat Account in fictitious and benami name and making of large applications in IPO is settled and the said dispute is predominantly commercial in nature having little criminal overtone. Hence, order quashed and set aside.
Facts- Two offences were registered on the complaint of Chief General Manager, SEBI with prosecution agency, CBI which led to registration of aforesaid FIRs. The allegations were in respect of certain brokers and individuals getting allotted Initial Public Offer (IPO) applications in fictitious names in respect of the issue of shares of Yes Bank Limited (YBL) to corner more shares meant for retail investors and sold them on profit on listing, thus making unjust profit. Adjudicating Authority, SEBI issued a notice to the petitioner herein on 7th June, 2006. It was mainly alleged that the petitioner had opened Demat Accounts in fictitious and benami names and made large number of applications in the IPOs in the category of retail investors in fictitious and benami names. This was done to corner the quota of retail investors in the IPOs by the companies.
