The Hindu Business Line : SEBI clears Rakesh Jhunjhunwala, others

The Securities and Exchange Board of India has cleared stockbroker Mr Rakesh Jhunjhunwala and his wife, Ms Rekha Jhunjhunwala, and Ra Re Enterprises of alleged charges of share price manipulation.

SEBI whole-time member, Mr T.C. Nair, passed an order on Tuesday stating that the material evidence on record were not sufficient to establish that they have indulged in manipulation of the prices. Therefore, "no direction needs be passed against Mr Jhunjhunwala and others," the order said.

SEBI had issued two show-cause notices dated July 17, 2003, and January 20, 2004, to Mr JhunJhunwala. The notices were issued against the group as the market regulator had observed that during the volatile period in stock markets in August 2002, the above group had traded through a number of brokers across stock exchanges and that they had taken concentrated positions in certain scrips. It was also observed that their trading during the period was concentrated in scrips in which the above group had substantial exposure and that the group had borrowed substantial amounts from various non-banking finance companies and used it for the purpose of trading.

In the light of the explanation submitted by Mr Jhunjhunwala and others, SEBI said, "There is no ground made out to pass any direction against them."

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