The Securities and Exchange Board of India on Tuesday barred Kalapi Shah from the securities market for five years due to violations of portfolio management services rules.
Shah, associated with Teji Mandi Analytics Pvt. and Anugrah Stock and Broking Pvt., was found to have managed TMAPL's affairs alongside Anil Gopal Gandhi, while his wife, Riddhi Kalapi Shah, acted as a 'namesake director'.
An affidavit submitted to SEBI on Aug. 19, 2020, confirmed Kalapi Shah's role in conducting TMAPL's business. TMAPL, a registered authorised person of ASBPL with the National Stock Exchange, aided ASBPL in carrying out portfolio management services activities in violation of norms.
Besides, the regulator noted that while performing the role of a director on behalf of his wife, Kalapi Shah even signed the board resolutions, sent e-mail communications to clients which consisted of PPTs as a part of derivative advisory service, canvassed clients and promised assured returns upon the instructions of Gandhi, thereby playing a major role in TMAPL.
"I note that it is already an established fact in the ...WTM order (passed in February 2023) that ASBPL, its directors and sister concern were engaged in providing Derivative Advisory Services, thereby violating ...the SCR (security contract) rules. It is also pertinent to mention that ASBPL is the broker and a member of the stock exchange, while TMAPL is an agent of ASBPL and registered with the stock exchange. Further, this is also an established fact that TMAPL aided and abetted ASBPL in carrying out the ...PMS activities and accordingly are liable under ...the SCR rules," SEBI Chief General Manager G. Ramar said.
Having found that the noticee (Kalapi Shah) aided and abetted ASBPL in providing DAS in the nature of PMS, promising assured returns, the noticee is liable for action, Ramar added.
Accordingly, SEBI has restrained Kalapi Shah from accessing the securities market and further prohibited him from buying, selling or dealing in securities, either directly or indirectly for a period of five years.
(With PTI inputs)
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