The Securities and Exchange Board of India has dropped its charges against leading stock broker Rakesh Jhunjhunwala, his wife Rekha and two firms -- Rare Enterprises and RKJ group -- for alleged share price manipulation during June-August 2002.
The case involves alleged share price manipulation in several stocks including NIIT, Marico Industries, Padmalaya Telefilms, United Breweries, Siemens and Bharat Electronics during the aforesaid period.
T C Nair, whole-time director, Sebi, in his order on Tuesday, said "no direction needs to be passed" after hearing to the replies to the showcause notices by the regulator.
The Sebi chanced upon huge transactions by Jhunjhunwala and his entities while looking into the volatility in the securities markets in 2002.
A detailed investigation by the market watchdog found that Jhunjhunwala and his firms were heavy sellers during end-July 2002, which also saw the Sensex slipping 6 per cent.
In stocks like UB, Siemens and Marico, the sales by the group almost accounted for the entire sales on a given day on the BSE, the investigation had found.
However, in its reply to the showcause notices, the RKJ group pointed out that during the same period, FIIs and mutual funds were net sellers for Rs 10,000 crore (Rs billion).