Artificial price manipulation requires proof of collusion, not merely buy orders placed above the last traded price.

Purchase orders placed above the last traded price did not, by themselves, establish artificial price manipulation under the fraudulent and unfair trade practices regime. The decisive requirement was proof of collusion or a nexus between the buyer, the seller and any counterparty so that the trades could be treated as non-genuine rather than genuine market transactions. On the recorded facts, that link was not established, and the normal screen-based price discovery process, including demand and supply, price-time priority and circuit limits, explained the pricing pattern. The charge of artificially raising the scrip price was therefore not made out, and the penalty order could not be sustained.

---

---

Issues: Whether the appellant's purchase orders, placed at prices higher than the last traded price, constituted an attempt to artificially raise the price of the scrip and attract liability under the fraudulent and unfair trade practices regulations.

Analysis: The trading pattern, by itself, was held insufficient to prove market manipulation. The decisive factor was whether there was collusion or a nexus between the buyer and the seller so that the trades could be characterised as artificial rather than genuine. The charge under the provision dealing with non-genuine transactions was not dealt with in the impugned order, and the recorded facts did not establish the necessary link between the appellant, its client, and the counterparty seller. The pricing on a screen-based exchange was explained by the normal price discovery process governed by demand and supply, price-time priority, and circuit limits. Mere placement of buy orders above the last traded price, without proof of collusion, was not enough to infer artificial price manipulation.

Conclusion: The charge of artificially raising the price of the scrip was not made out, and the penalty order could not be sustained.

---