1.

Chairman
Securities Stock Exchange Board of India
Mittal Court, “B’ wing, Narman Point
Mumbaii

2. Mr. R.K.Nair
Chief Vigilance Officer-SEBI
BKC, Bandra East
Mumbai-400051

3. Chief Vigilance Commissioner

Central Vigilance Commission
Satkarta Bhavan
INA, New Delhi Dated 31/03/07

Sub: - Inquiry into my allegations of favouring M/S Sunglow, ignoring

directions of law to injure me and prevent recovery of my shares from M/S
Sunglow, ignoring various circulars, rules by NSE/Arbitrators & SEBI
officials.

1. This has reference to my various letters / e-mails on above subject.

2. In this regards I want to know Whether intentional omissions and

commissions committed by NSE officials, Arbitrators on panel of NSE,
SEBI Officials, mentioned in henceforth Para, have been investigated, if
investigated, what is out come.

3. I had sent complaint against M/S Sunglow Capital Services Ltd, member
broker of NSE on 25/08/2003 to NSE & SEBI.

4. NSE sent me letter on 02/09/2003 asking to give some information which I

had complained that broking member/his agents did not provide, I replied
on 22/09 giving all required information available with me and clarifying my
position on balance points. In all these letters I had sought clarifications
regarding working of Mr Anil Thukral as “Sub-Broker” of M/S Sunglow

5. I want to know whether you have investigated, why investigations were not
carried out by NSE/SEBI officials regarding working of Mr Anil Thukral as
“Sub-Broker” and whether there is possibility of corrupt practices to favour
M/S Sunglow by these officers, whether this issue comes under purview of
Vigilance or not.

6. That Circular of March 17, 1994 clearly notifies that “ Please bring it to
notice of your member brokers that dealing with sub-brokers who are not
registered (or treating them as client and not sending their applications for
registration) is violation of SEBI act 1992 and such a brokers are liable for
action” Then why no investigations were carried out till January, 2005,
whether M/s Sunglow is showing sub-broker as client or not? Why after
finding that Mr. Anil Thukral was working as “unregistered sub-broker”, I
was not informed, inspite of repeated e-mails/ letters. Does this not amount
to corruption? Does this not fall under purview of vigilance?
7. I have alleged that NSE officials are guilty of protecting the member broker
by ignoring own circulars (circular no 163 NSE/MEM/1591 DT APRIL
29,2000, cir no NSE /I&ID/ 2001/1 DT MARCH 16, 2001,
NSE/ARBN/1354/1999 DT DEC 27, 1999). These circulars in my
knowledge, there can be other circulars, provisions of rules etc ignored. Do
these intentional ignoring circulars to favour member broker does not come
under “Corruption”?

8. In Crl Writ Petition 1551/2004, SEBI/NSE officials were issued notices by

court in Dec-2004, even then they did not reply to notice for almost two
years. IS THIS DOES NOT AMOUNT TO MISCONDUCT?

9. I have highlighted intentional misconduct/ corrupt [t practices by Arbitrators

approved by SEBI & appointed by NSE in my e-mails/letters, BUT NO
ACTION HAS BEEN TAKEN BY SEBI.

10. I want to know about investigations of following allegations: -

Letter of authorization given by Mr Anil Thukral to M/S Sunglow states that

“I/We request you not to issue me/us cheque(s)/shares
on daily basis in case of credit balance and same may
be retained/withhold with you for the adjustment of any
possible debit in my/our account of any
purchases/margin’s in future on subsequent date (s)”.
Further you are requested to receive / make the
payments of funds/ shares on our behalf from/to any
person, if any, as and when desired by me/us”

EVEN A MATRICULATE PERSON READING THE ABOVE DOCUMENT

PRODUCED BY M/S SUNGLOW IN ARBITRATION WILL CONCLUDE
THAT: -

a) Mr Anil Thukral was dealing for number of persons,

it is why he asked broker to “receive / make the
payments of funds/ shares on our behalf from/to any
person, if any, as and when desired by me/us”
b) As per definition given in SEBI “Brokers/ sub-
broker” rules, he was sub-broker and since he was
not registered with SEBI, he was unregistered sub-
broker.
c) Further this document clearly establishes that Mr
Anil Thukral was keeping shares purchased in
accounts of M/S Sunglow and having credit facility.

Contrary to this That The Arbitrators at Para-16 of award stated that

“he entered into irregular agreements, on his own
admission, for not making full payments for his purchases
He cannot, therefore claim any advantage arising from his
own wrong dealings, as they were conducted through “back
door”
 i) WHO WAS DEALING IN BACK DOOR? M/S Sunglow with Mr. Anil
Thukral Or Complainant? SEBI has to investigate and clarify.

ii) In case buying/selling shares by not making full payments is an offence

as stated by Arbitrators, SEBI is supposed to take action against all
brokers who are giving these facilities to clients., INCLUDING M/S
SUNGLOW OR CERTIFY THAT M/S SUNGLOW WAS NOT GIVING THIS
FACILITY TO CLIENTS. SEBI has to tell that whether buying shares by not
making full payment is standard trade practice or not? SEBI/CVC has to
investigate and inform complainant , whether this is an offence as stated
by Arbitrators”

iii) As per SEBI, Arbitrators have to conduct as per SEBI act, rules, and
circulars. SEBI has to investigate and inform complainant , whether
Arbitrators ignore SEBI act, rules, and circulars or not.

iv) SEBI/CVC has to investigate and give decision whether Arbitrators

misconducted or not, if misconducted, they are to be removed from panel
of Arbitrators.

11. As per own admission by SEBI officials, SEBI had concluded in Feb-2005
that Mr. Anil Thukral was working as “unregistered sub-broker” and SEBI
proposed to prosecute him. Why then he has not been prosecuted till
date? Does this not mean that accused have bribed concerned officers
and concerned officers to favour him sitting on file for years? Does this not
covered under corruption?

12. I have alleged that M/S Sunglow fabricated member-client agreement, as

this is not on stamp paper. As per book being circulated by NSE by
Heading “ For investors”, it is stated that “ A check should be done whether
the agreement is on the stamp paper of requisite value and whether the
stamp paper is valid. Date of agreement should be within the validity
period of stamp papers” but SEBI/NSE officials and Arbitrators have
intentionally ignored and not taken any action. SURPRISINGLY
ARBITRATORS APPROVED BY SEBI DO NOT KNOW THIS
REQUIREMENT AND SEBI IS STILL APPROVING THEM ON PANEL OF
ARBITRATORS. FOR WHAT CONSIDERATION?

13. As per own admissions of SEBI official, a person if registered under one
identity cannot operate, receive payments, shares in another name. As per
M/s Sunglow, Mr. Anil Thukral was operating under name of Mouz Malik,
receiving payments shares in name of Mouz Malik. EVEN THEN NO
ACTION HAS BEEN TAKEN BY SEBI AGAINST NSE OFFICIALS/
ARBITRATORS, SEBI OFFICIALS FOR NOT INVESTIGATING IN TIME
AND SITTING ON MATTER FOR YEARS. IS THIS NOT CORRUPT
PRACTICE?

NSE/SEBI officers did not apply mind to find out, Who is Mouz Malik?
Whether Mr. Anil Thukral is operating as Mouz Malik or M/S Sunglow has a
fictitious name under which all unregistered sub-broker of M/s Sunglow are
working. SEBI has to investigate and give findings.
14. The mentioning of following reason by Arbitrators in their award in
support of their rejection of my claim speaks of their incompetent :-

“It is not the case of the applicant that he had given any
contra instructions to Mr. Anil Thukral nor has he called
him as witness”

First and foremost thing is that my claim rests on my complaint that as

per own admission of Mr. Anil Thukral, when he came to my
residence, they were selling & repurchasing shares transferred by me
without my knowledge & consent, In May/June shares prices
increased suddenly & they were caught on wrong foot, so could not
buy back shares & started telling that In suffered losses.

Any person with little knowledge will not say that “it is not case of the
applicant giving any contra instructions” THIS PROVES MY
ALLEGATIONS THAT THEY ARE CORRUPT AND INCOMPETENT.
SEBI OFFICIAL BY CONTINUING THEM ON PANEL OF
ARBITRATORS ARE ACCOMPLICE IN CRIME.

As regards to producing Mr. Anil Thukral as witness In case it was very

essential to call Mr. Anil Thukral as witness, arbitrators should have
directed petitioner or respondent to approach competent court as per
section 27 of arbitration and reconciliation act 1996. The relevant portion of
act is reproduced below;-

27. Court assistance in taking evidence; 1) The

Arbitrators or a party with the approval of the Arbitrators
may apply to the court for assistance in taking evidence,

Arbitrators neither asked any party to dispute to take assistance of court

nor they themselves obtained assistance of court, which proves petitioner’s
allegation that either they did not know the act or ignored to favour the
respondent.

15. That it appears that NSE appointed Ms Lakshmi Swaminathan, Mr.

Ahooja, Mr. Biswas as Arbitrators & SEBI approved their name by unfair
means, as they did not have any knowledge of share transactions trade
practices, were corrupt, ignored various circulars, SEBI act, Arbitration act,
passed award without asking for the required records of respondent M/S
Sunglow as per NSE rules & regulations. (Details given in my complaint dated
July-2005 to Chairman-SEBI & December-2005 copy attached)

That inspite of repeatedly pointing out proper investigations have not been
conducted in working of M/S Sunglow, particularly daba trading and fraudulent
activities (working under fictitious name of Mr. Mouz Malik) & Chairman-SEBI,
members-SEBI, CVO-SEBI has not taken any action against, SEBI officials,
NSE officials & Arbitrators.
As there is every possibility of M/S Sunglow having bribed SEBI / NSE officials,
as such you are therefore requested to conduct inquiry into my allegations and
inform action taken at the earliest.
 16. I reproduced some of sections of SEBI act, which SEBI officials to favour M/S
Sunglow, intentionally ignored.

Section 15 F, which states that Penalty for failure in case of stock Brokers 15F. If any
person, who is registered as a stock broker under this Act, -

I. fails to issue contract notes in the form and manner specified by the stock
exchange of which such broker is a member, he shall be liable to a penalty
not exceeding five times the amount for which the contract note was
required to be issued by that broker;
II. fails to deliver any security or fails to make payment of the amount due to
the investor in the manner or within the period specified in the regulations,
he shall be liable to [a penalty of one lakh rupees for each day during which
such failure continues or one crore rupees, whichever is less.]52
III. charges an amount of brokerage which is in excess of the brokerage
specified in the regulations, he shall be liable to [a penalty of one lakh
rupees]53 or five times the amount of brokerage charged in excess of the
specified brokerage whichever is higher.

[Penalty for fraudulent and unfair trade practices 15HA. If any person
indulges in fraudulent and unfair trade practices relating to securities, he shall
be liable to a penalty of twenty-five crore rupees or three times the amount of
profits made out of such practices, whichever is higher.

Section 217 IPC “Whoever, being a Public Servant, knowingly disobeys any
direction of law as to way in which he is to conduct himself as such public
servant, intending there by to save, any person from legal punishment or subject
to him to a less punishment than that to which he is liable, or with intent to save,
or knowingly that he is l;ikely thereby to save, any property from forfeiture or any
charge to which it is liable by law, shall be punished with imprisment of either
description for a term which may extend to two years, or with fine, or with both.”

S.K.Kapoor
3, Sunshine Apartment,
A-3, Paschim Vihar,
New Delhi-110063

COPY TO
President Govt of WHAT IS USE OF VIGILANCE DEPARTMENTS, IF,
India CVO’s SHIELD THE CORRUPT STAFF. Although CVC
claims that all complaints are dealt to conclusive end,
Hon’ble Finance/ but in practices, all are just filed, to favour corrupt.
Home Minister

Secretary Ministry of
Finance