February 11, 2009
PR No. 084/2009

Order in the matter of irregularities relating to Initial Public Offerings

A panel consisting of Whole Time Members, SEBI, Shri M. S. Sahoo and Dr. K. M. Abraham has passed a consent order dated February 10, 2009, in the matter of irregularities relating to Initial Public Offerings directing Sugandh Estates & Investment Pvt. Ltd. (SEIPL), Parag P. Jhaveri, Kamal P. Jhaveri and Ambuja Estates & Holdings Pvt. Ltd. to disgorge the unlawful gain of Rs. 24,00,000/- (Rupees twenty four lakh only) made by them, pay a sum of Rs. 1,80,00,000/- (Rupees one crore eighty lakh only) towards settlement charges and undergo voluntary debarment for a period of three years from the March 1, 2009.
The above four entities had requested SEBI to permit them to sell shares in the demat accounts held by them, which were frozen pursuant to SEBI order dated April 27, 2006, to enable them to pay the aforesaid amounts to SEBI as they have no other source of income. Therefore, in view of the facts and circumstances of the case, following directions were issued:-

  1. NSDL shall permit operation of aforesaid demat accounts for the limited purpose of sale of the shares. This is subject to any encumbrance/attachment by any Enforcement/Investigating Agency/Court on the shares. 

  2. Depository Participant (DP) M/s. Karvy Stockbroking Ltd. of NSDL and the designated Broker M/s. Khandwala Integrated Financial Services Pvt. Ltd., member of NSE through whom the applicants intend to sell these shares are instructed to take prior clearance from NSDL to the effect that the shares proposed to be sold are free from any encumbrance. Further, they shall ensure that the total sale by the applicants should not exceed Rs. 2.04 crore in value net of brokerage. 

  3. The NSE, in coordination with the designated broker, shall ensure that entire sale proceeds (pay out) in respect of shares sold by the applicants are directly paid to SEBI within seven days from the date of sale. 

  4. The entities are directed to complete the sale of shares latest by February 20, 2009.  

The order further states that with effect from March 1, 2009, subject to compliance with the directions issued, the consent order shall:

  1. dispose of pending proceedings under sections 11 and 11B of the SEBI Act, 1992; 

  2. revoke the directions issued in the ad-interim confirmatory order dated May 09, 2007; and 

  3. dispose of pending adjudication proceedings in the matter of IPO irregularities against the applicants. 


February 11, 2009


For full copy of order against SUGANDH ESTATES & INVESTMENTS PVT. LTD.,