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Oct 08, 2012, 04.12 PM IST
The Securities Appellate Tribunal (SAT) has upheld insider trading charges against VK Kaul, a former independent director of Ranbaxy, and his wife Bala Kaul, accusing them of insider trading.
The Securities and Exchange Board of India (Sebi) had alleged that VK Kaul, who knew in advance that Ranbaxy's arm Solrex is going to buy shares of Orchid Chemicals, traded on behalf of his wife ahead of the transaction. While Kaul has been fined Rs 50 lakh, his wife Bala Kaul has been handed a fine of Rs 10 lakh, Sebi said in two separate orders.
The case relates to the sale of 6.5 lakh shares in Orchid Chemicals & Pharmaceuticals (OPCL) by Bear Stearns in March, 2008.
The scrip saw a huge fall in the last half of March, 2008, but then recovered significantly. Several alerts were generated at the NSE and BSE and the scrip was taken up for joint investigation by the exchanges on the basis of which a report was submitted by them in April that year.
Bala Kaul had bought shares of OCPL from stockbroker Religare Securities on March 27-28, 2008, just prior to the start of share buying by Solrex, a Ranbaxy holding company, on March 31, 2008.
She bought a total of 35,000 shares at an average price of Rs 131.71 and sold them on April 10, 2008, at an average price of Rs 219.94, the Sebi said in its order.
VK Kaul was at that time serving as an independent director in Ranbaxy Laboratories.
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