J. Sagar Associates (JSA) represented Mr. Arun Jain, CMD of Polaris Software Lab Limited (“Polaris”) before a Whole Time Member of the Securities and Exchange Board of India (“SEBI”) for alleged violations of SEBI Insider Trading Regulations, 1992. Mr. Jain was alleged to have purchased the shares of Polaris whilst in possession of unpublished price sensitive information (“UPSI”). The UPSI was allegedly on two counts: i) the financial statements of Polaris for the quarter ended June 30, 2008 which were under preparation at the time when Mr. Jain effected the purchases; and ii) Polaris was considering the possibility of entering into the real estate business and this proposal was made known to Mr. Jain before he effected the purchases.

SEBI has passed an order dated March 23, 2018 dropping the allegations against Mr. Jain. The order of SEBI asserts the ratio of the Securities Appellate Tribunal in the case of Samir Arora which SEBI had challenged earlier before the Hon’ble Supreme Court and impacts lot of cases where SEBI has issued show cause notices to various entities on the basis of mere suspicion. Interestingly, there was an Exparte Order passed by SEBI in this matter where the proceeds of sale were directed to be deposited with SEBI. The recent order permits Arun Jain to withdraw the same with interest from SEBI. The JSA Team comprised of Partner – Ravichandra S Hegde, Senior Associate – Paras Parekh and Associate – Stuti Shah.