NSE suspends trading in Cyberspace

Our Markets Bureau

Mumbai, April 26 : The National Stock Exchange (NSE) has decided to suspend trading in equity shares of Cyberspace Ltd with effect from April 30, 2001 for non-compliance with the provisions of the listing agreement executed by the exchange.

Sources at the NSE said that, the exchange had sent a notice to the company seeking reasons for the non-compliance. As the company failed to provide a response to the notice, the exchange has decided to suspend trading in equity shares of the company.

The trading will remain suspended until the company satisfactorily complies with the provisions of the listing agreement. It can be mentioned that the Bombay Stock Exchange (BSE) had earlier decided to suspend trading in the stock on similar grounds from April 19, 2001. Both the exchanges have withheld the pay-out for the stock because of alleged circular trading in the stock.

Brokers involved in the trading of Arvind Johri-promoted Cyberspace Ltd have got stuck with an estimated amount of Rs 25 crore, following the withholding of pay-out of funds and securities by the stock exchanges. According to franchisees of Century Consultants, there are around five brokers alleged to be involved in circular trading along with Arvind Johri.

Market sources alleged that Arvind Johri has sold shares of Cyberspace Ltd through these brokers on a spot basis only to buy them back again in his broking arm Century Consultants.

He then delivered these shares to the brokers involved in order to avail cash discount for spot delivery of cash in return for the shares. Mr Johri has been absconding since.

The brokers, who should have received the money in return for these shares got stuck owing to withholding of pay-out of funds and securities by the stock exchanges.