Pursuant to the investigations in the wake of volatility in index movements during mid February and early March 2001, entities controlled and connected by/with Mr. Shankar Sharma & Mrs. Devina Mehra like First Global Stock Broking Pvt. Ltd. (FGSB), Stock Broker, Merchant Banker and Portfolio Manager and Vruddhi Confinvest India Pvt. Ltd. (VCIP), Sub-broker were directed vide order dated May 25, 2001not to undertake any fresh business till further orders. Subsequently an enquiry officer was appointed.

The Enquiry officer submitted his report on January 09, 2002 and found, interalia that First Global Stock Broking Pvt. Ltd. & Vruddhi Confinvest artificially depressed prices of select scrips and were guilty of violating code of conduct specified in schedule-II of SEBI (Stock Brokers and Sub-brokers) Regulations, 1992, Regulation 14(3) of SEBI (Portfolio Managers) Regulations, 1994 and Regulation 4(a) to (d) of SEBI( Prohibition of Fraudulent and unfair trade practices relating to securities market), 1995. The Enquiry Officer recommended cancellation of Certificate of Registration of FGSB as Stock Broker and Portfolio Manager and VCIP as Sub-broker.

Pursuant to the Recommendations of the Enquiry officer a show cause notice was issued to FGSB and VCIP. A hearing was given to FGSB & VCIP by SEBI Board. After taking into account findings and recommendations of the enquiry officer and submissions of FGSB and VCIP, SEBI Board has passed an order in its meeting on 12th September 2002 cancelling the certificate of Registration granted to FGSB as Stock broker (SEBI Reg. No. INB230722136 and INB010722152) and Portfolio Manager (SEBI Reg. No. INP000000381) and that of VCIP (SEBI Reg. No. INS010647738/01-07221) as a Sub-broker.

The said order will come into effect immediately. However as per the directions of the Hon’ble High Court of Bombay vide its order dated 11th April 2002 in WP no. 824 of 2002 this order stands stayed for four weeks from the date of receipt of the copy of this order by them. Till such time SEBI’s order dated 25th May 2001 passed under section 11B of SEBI Act, 1992 shall remain operative against them as directed by the Hon’ble High Court of Bombay in its order.