SEBI v. First Financial Services Ltd and others (preferential allotment price-rise scheme, 2022)

Judgment entered

✓ Checked against the primary document on October 8, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, in a single reading of the order; an independent second reading of 60 SEBI records agreed on every field for 56, the four misses being penalty amounts; a later sample of 50 of the SEBI records added on 9 October agreed on every field for 46. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

Report an error in this record (sebi-63625-price-manipulation-2022) by email

A SEBI adjudicating officer on 30 September 2022 imposed penalties on 35 of 84 noticees in the First Financial Services case, finding that connected parties pushed up the share price with small trades after two preferential allotments. The penalties come to Rs 71 lakh, of which Rs 5 lakh is contingent on a Supreme Court appeal.

The record

What was ordered

Civil penalty

—

Disgorgement

—

Prejudgment interest

—

Total relief

—

Alleged gain

—

Penalty as published

7.1m INR

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars. This regulator states penalties in INR. The figure is recorded as published and is not converted, so it does not appear in the USD totals or medians used elsewhere on this site.

What is alleged to have happened

First Financial Services Ltd (FFSL) is a listed company that made two preferential share allotments at Rs 20 a share. SEBI investigated the trading in its shares and named 84 noticees: the company, its directors, the allottees and trading and financing entities said to be connected to them. The adjudicating officer's order is dated 30 September 2022.

SEBI alleged that the allotments were a tool in a scheme in which connected entities lifted the share price artificially, so that the allottees could sell after the lock-in period at a large gain. The notice put the allottees' gains at Rs 67.79 crore, alleged that the company did not use the money as disclosed and that it passed funds through other entities to certain allottees and to buyers of its shares after the lock-in, and alleged that two allottees were indirectly funded to subscribe.

The order finds that 35 noticees violated section 12A of the SEBI Act and the fraud-prevention rules in the PFUTP Regulations, by placing small orders at rising prices and carrying out connected counterparty trades to push the price up, or by helping move funds and sell the shares. The company was also found to have given wrong information to SEBI in answer to a summons, and to have breached listing-agreement requirements on reporting variation in use of funds. Eight further noticees and one of the price-support traders were penalised for failing to make a mandatory public offer under the takeover regulations. The remaining noticees were not penalised.

Penalties were Rs 6 lakh and a Rs 5 lakh listing-agreement penalty on the company, Rs 5 lakh on each of the three directors and on Prem Lata Nahar, Rs 11 lakh on B P Jhunjhunwala, and Rs 1 lakh on each of 29 other noticees, a total of Rs 71 lakh. The company's Rs 5 lakh under section 23E of the securities contracts law is enforceable only after the outcome of SEBI's pending appeal to the Supreme Court in another case.

The record does not show whether anyone appealed, whether SEBI ordered any disgorgement of the Rs 67.79 crore alleged gain, or any actual investor losses.

This library tags the matter as price manipulation. The tagging is ours, not the regulator's.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the order.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Price manipulation — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2022-09-30 SEBI order

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEBI order

The linked release is published by the issuing regulator under its own terms. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added October 8, 2026. submit a correction.