SEBI Case Law November 22, 2024 Jagsonpal Pharmaceuticals Limited

Facts of the Case: A detailed investigation was undertaken by SEBI to ascertain whether the suspected entity/ies traded in the scrip of M/s Jagsonpal Pharmaceuticals Limited (“JPL/Company”) when in possession of the UPSI and if there were any violations of the provisions of the SEBI Act, 1992 and the SEBI (Prohibition of Insider Trading) Regulation 2015 (“PIT Regulations”). Based on the analysis of trading pattern, one Mr. Maneesh Kumar Jain (“Noticee no.1”) was shortlisted by SEBI as a suspected entity.

It was, inter alia, observed that JPL had made an announcement to NSE of the press release dated February 21, 2022 titled ‘Intimation for Public Announcement under Regulations 3(1) and 4 read with Regulations 13(1), 14 And 15(1) of SEBI (SAST) Regulations, 2011’. Thereafter, the Open Offer was made at a price of Rs. 235/- per Offer Share making the total consideration payable by the acquirer under the Open Offer at the Offer Price of Rs.1,60,06,97,800/- payable in cash through normal banking channels. The news of substantial acquisition of shares was announced pre-market hours on February 22, 2022 (i.e. at 07:09:27 am). It was observed that the said news had impacted the price of the scrip of JPL as it registered a rise of around 20% on a close-to-close basis and rise of 5.96% on open-to-close basis. Further, it was also observed that the scrip hit a new 52 week high price of Rs. 246.45/- on February 22, 2022. Thus, the announcement dated February 22, 2022 made by JPL to NSE as regards substantial acquisition of shares under Regulations 3(1) and 4 read with Regulation 13(1), 14 and 15(1) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 was observed to be an UPSI under the provisions of Regulation 2(1)(n) of the PIT Regulations. On examining the trading pattern of Noticee No.1 during the relevant period on NSE and BSE, it was observed that Noticee No. 1 had traded in the scrip of JPL during the UPSI period.

SEBI Order: In exercise of the powers conferred upon SEBI under Sections 11(1), 11(4), 11(4A), 11B(1) and 11B(2) of SEBI Act, 1992 read with Section 19 of the SEBI Act, 1992 and SEBI (Procedure for Holding Inquiry and Imposing Penalties) Rules, 1995, SEBI restrained JPL and Mr. Maneesh Kumar Jain from accessing the securities market for a period of one (1) year and further Mr. Maneesh Kumar Jain is directed to disgorge a sum of Rs. 31,39,000 within 45 days from the date of receipt of this order. Also, SEBI imposed a total penalty of Rs. 25,00,000/- on JPL and Mr. Maneesh Kumar Jain for violating Regulation 4(1) and Regulation 3(1) of the PIT Regulations and Section 12A(d) and 12A(e) of the SEBI Act, 1992.

---

If you’re looking to register your trademark and protect your brand, feel free to contact us for expert assistance and seamless registration services