SEBI v. Kirodi Mal Modi and others (synchronised trades to consolidate promoter holdings, Bhageria Industries, 2023)

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.

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In March 2023 a SEBI adjudicating officer penalised 63 of 84 noticees a combined Rs 4.48 crore over trading in Bhageria Industries Ltd shares from 2014 to 2016. The order found that promoters and linked entities bought preferential allottees' shares in synchronised trades through two brokers, giving the allottees an exit and generating artificial volume.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

—

Alleged gain

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Penalty as published

44.8m 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

Bhageria Industries Ltd (BIL) made two preferential allotments, in August 2011 and March 2012, at Rs 30 a share, some to promoter entities and some to non-promoter allottees. SEBI investigated trading on the BSE and NSE between 17 April 2014 and 25 October 2016, a period in which the price rose from about Rs 31 to Rs 711, most steeply in 2016. It named 84 noticees, including members of the promoter families, the allottees and their relatives, companies, a broker, Choice Equity Broking, and a sub-broker, Satya Shakambari Securities.

SEBI alleged that most of the non-promoter allottees were linked to the promoters, that after the lock-ins ended, promoter-connected entities took over the allottees' shares by off-market transfers and then on the market, mainly through synchronised trades. It said the allottees sold essentially all of their holdings through Choice Equity Broking while the promoter side bought through Satya Shakambari, a sub-broker operating from premises leased from a promoter, and that part of the sale money was routed back to promoter entities. It alleged a meeting of minds to consolidate holdings and give the allottees an exit, generating artificial volume.

The adjudicating officer found the fraud-on-the-market provisions of section 12A and Regulations 3 and 4 breached by 63 noticees, with the broker and sub-broker also found to have assisted the scheme. He disposed of the notice without penalty against 21 noticees, among them Niranjanlal Bhageria HUF, Niranjanlal Keshavdeo Bhageria, Lalit Kumar Saraf and Kali Mohan Bhattacharya, and noticees 68 to 84. He noted that it was not possible to quantify gain or investor loss.

The penalties under section 15HA range from Rs 5 lakh to Rs 10 lakh per noticee, with the broker penalised Rs 20 lakh under 15HA and Rs 5 lakh under 15HB and the sub-broker Rs 10 lakh and Rs 5 lakh. Adding the amounts in the order's table gives Rs 4.48 crore in total. Penalties on two nominee-held accounts are to be borne by the brokerage that represented them, and on a third by the research firm that represented it. No market bar or disgorgement was ordered.

The record does not show appeals, payment, or how the price rise to Rs 711 related to the trading; the order observes only that prices tracked the sector except around September and October 2016. The total here is our sum of the order's table. It describes no criminal case.

This library tags the matter as matched orders and 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 2 techniques 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.

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

Timeline

1. 2023-03-31 SEBI adjudication 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.