Action against Mr. Arun Bajoria in the case of 
Bombay Dyeing and Manufacturing Co. Ltd.
 
Investigations, Enforcement and Surveillance Department

SEBI conducted investigations into the alleged violations of SEBI (Substantial acquisition of shares and Takeovers) Regulations,1997 ( the Regulations) by Shri Arun Bajoria in acquiring the shares of Bombay Dyeing and Manufacturing Co. Ltd. ( BDMCL). Investigations revealed Shri Bajoria along with persons acting in concert i.e. Mega Resources Ltd., Mega Stock Ltd., The Hooghly Mills Ltd. Pooja Bajoria, Mohini Devi Bajoria, Lata Devi Bajoria and Meenakshi Jatia had acquired 20,69,732 shares of BDMCL on March 15, 2000 which exceeded 5% of the paid up equity capital of BDMCL. The total holding of Shri Arun Bajoria with persons acting in concert and with persons deemed to be acting in concert was 56,77,326 shares as on September 21, 2000 which constituted around 13% of the share capital of BDMCL. 
 
Shri Bajoria along with persons acting in concert were required under the Regulations to disclose within 4 days the aggregate of their holdings to the target company when they acquired 20,69,732 shares which exceeded 5% equity of BDMCL i.e. by March 20,2000. However Shri Bajoria failed to disclose BDMCL about the said acquisition as required under regulation 7(1) of the Regulations. 
 
Further, it was also noticed during the course of investigations that there was a deliberate attempt to create an evidence of submission of information about the holding in the target company to CSE. On the basis of circumstantial evidence and material on record, the contention of Mr Bajroia that the said information was sent to BDMCL under certificate of posting was rejected. The purported communication to BDMCL was not considered by Board as sufficient compliance of the disclosure under the Regulation. On account of non-compliance and attempted creation of evidence, Shri Arun Bajoria along with the persons acting-in-concert (Mega Resources Ltd., Mega Stock Ltd., The Hooghly Mills Ltd. Pooja Bajoria, Mohini Devi Bajoria, Lata Devi Bajoria and Meenakshi Jatia) were debarred from accessing the capital market and from dealing directly or indirectly in securities for a period of one year with immediate effect. 
 
As the holding of Shri Bajoria in BDMCL has already reduced to less than 5% of the paid up equity capital of BDMCL, no specific directions were issued to sell the shares acquired in violation of the Regulations. 
 
It was further directed that an Adjudicating Officer be appointed under SEBI Act,1992 within 15 days of the passing of this order to hold an inquiry into the above non-disclosure of fact of acquiring shares to the target company and adjudicate upon the penalty, if any, based on the merits of the case as per the procedure specified therefore.