TOPIC 49: QUICK REFERENCE TO “Insider Trading”

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Quick Reference about "Insider Trading":-
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Legal Provision:-.
Section 195 of Companies Act, 2013.
SEBI (Prohibition of Insider Trading) Regulations, 2015.
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Points:-
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1. Insider Trading means dealing with "Unpublished Price Sensitive Information".
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2. It's absolutely illegal.
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3. Insider Trading affects the the Price of Securities of the Company.
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4. It is not apply in ordinary course of business or profession or employment.
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5. It includes activities like buying, selling, dealing of Securities by Director or KMP or any other officer of the Company on the basis of Unpublished Price Sensitive Information.
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6. Penalty as per Section 195(2) of Companies Act, 2013 :-
The person is punishable for imprisonment of a term which may extend to 5 years or with fine which shall not be less than ₹ 5 lakh but which may extend to ₹25 crore or 3 times of amount of profit made from Insider Trading, whichever is higher or both.
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7. Insider Trading also includes an act of Counselling about Price Prediction whether directly or Indirectly to any person.
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8. Insider gets Inequitable gain from trading through Malpractices.
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Regards
ACA SOURAV BAGARIA