TaxTMI 
TaxTMI 
2025 (11) TMI 611
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....ted an investigation against suspected entities and trading members and noted that a big client was placing orders through 25 trading members. Appellant was working as a chief dealer of Axis Mutual Fund. It is alleged that he traded in different securities ahead of impending orders placed on behalf of the big client. SEBI issued a show cause notice cum interim order dated February 28, 2023 against 20 noticees and issued certain directions, which include restraining them from buying, selling or dealing in the securities market, impounding a sum of Rs. 30,55,89,668.96. 4. In response to the show cause notice, appellant vide letter dated March 23, 2023 requested all the documents and material collected during the investigation. In response, SEBI provided an opportunity of inspection to the appellant and his authorized representative. It is appellant's case that on conclusion of inspection a soft copy of the investigation report and appellant's statements were provided. Appellant's authorized representative was assured that annexure to the investigation report would be subsequently provided. Thereafter, some exchange of correspondence has taken place seeking further documents. SEBI,....
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....ations. 3. Data collected from the devices of Axis Asset Management Company Limited utilized by Mr. Viresh Joshi so the seized or examined by the Investigation Team during the Investigation Period. 4. Digital Evidence/Mobile Device Collection Form for Ms. Dharini Kurani for the Search and Seizure conducted on May 12, 2022. 5. Panchnama for the Search and Seizure allegedly at the home of Mr. Nishil Marfatia on May 16, 2022. 6. Statement of the following entities recorded during Search and Seizure Operations: a. Mr. Deepak Agarwal May 12, 2022 b. Ms. Dharini Kurani May 12, 2022 c. Mr. Jinesh Gopani May 12, 2022 d. Mr. Kishor Kumar Morbia May 12, 2022 e. Mr. Vipul Gangaram Joshi May 12, 2022 f. Mr. Paresh Mehta May 12, 2022 g. Ms. Rupal Bhavin Shah May 16, 2022 h. Mr. Ankit Suresh Jajoo May 16, 2022 i. Mr. Bhavin Shah May 16, 2022 j. Mr. Suresh Kanmal Jajoo May 16, 2022 k. Mr. Pranav Vora May 17, 2022 7. Communications of Investigation Team with the entity/entities which provided the Tower Details of Cell Numbers + 91 9869352922 and + 91 85118....
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....a backed up from the devices of the entities to the extent it is relevant. SEBI is right in contending that providing the entire chat between the third party's will be in violation of right to privacy of such third parties. Appellant has been permitted inspection. SEBI shall make available the chats between the appellant and any entity. 12. The second item sought is data from the mobile phones of Ms. Dharini Kurani and Mr. Prijesh Kurani. Appellant is seeking for the data from the mobile phone of these two entities. Appellant in his Affidavit dated July 24, 2024 has mentioned the purpose of the said data is to understand the context of conversations and data found in the chats. It is also stated by the appellant that appellant will not be able to understand nature and gravity of the evidence available against him. Reference is made to chats allegedly between Prijesh Kurani and 'Asdfg' mentioned in para 19 of the paper book. SEBI's stand is that the chats with 'Asdfg' has been found to be operated by the appellant himself and the same has been admitted by the appellant's brother. Further the hyperlink of the video clip has already been provided. Since it is admitted by appellant'....
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....e said document contains private information of third parties including the details of Mobile Phones, Email ID along with its passwords and also details of witnesses. SEBI has admitted to have given the Digital Evidence Form in respect of other entities. By the same measure, appellant shall be entitled for the Panchnama for Search and Seizure at the home of Mr. Nishil Marfatia. SEBI shall provide the redacted version containing the information relevant so far as the appellant is concerned. 16. The sixth item is the statements of the entities recorded in search and seizure operations. SEBI's stand is that statements relied upon during the investigation pertaining to the appellant have been provided. Such stand is untenable. Appellant shall be entitled for the entire statement of the entities recorded during the search and seizure operations, however SEBI shall be with liberty to 'mask' or redact such portions which pertain to any other entity which is irrelevant for appellant's case. 17. It was submitted during the hearing that, items number 7 and 8 have already been furnished. 18. Item no. 9 is the Trade Log and the Order Log for the scrip of 'Gland Pharma Limited' on Dece....
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....tement recorded of other Fund Managers. It is settled that though it can be claimed that no reliance is placed on certain document, an astute officer can use the material without actually referring to the same. SEBI has not claimed the statements to be sensitive in nature. As a rule, a noticee is entitled for every material sought to be used against him. On that principle, appellant shall be entitled for copies of the statements of the Fund Managers recorded by SEBI. We direct the SEBI to make available those statements. 21. Item number 12 is documents collected from appellant's desk at Axis Asset Management Company. In response to this request SEBI has stated that 'inclined the contents of preceding paragraphs are repeated'. We may record that in the preceding paragraphs SEBI has taken stand such as it has not relied upon the documents, appellant has deliberately sought the documents which has been provided etc. Appellant has sought for the documents collected from his desk and he is entitled for the same. We direct SEBI to provide them. 22. Item number 13 is daily register kept by the Axis Asset Management Company regarding the custody of appellant's devices. The purpose st....