Sebi's litigation scoreboard: More courts wins , fewer appeals, and crackdowns
The latest annual report of the Securities and Exchange Board of India shows that new appeals against Sebi's decisions at the Securities Appellate Tribunal (SAT) fell to 533 in FY25 from 821 in the year prior, with 73% cases dismissed and only 5% allowed.
In the Supreme Court, 90% of the 80 disposed cases went the regulator's way.
However, Sebi's 2024-25 report shows the regulator closed the year with 960 SAT appeals pending and 520 cases pending in the Supreme Court.
Of the 422 appeals disposed of by SAT in 2024-25, 308, or 73% of the cases, were dismissed and only 23 (5%) cases were taken up for hearing. Apart from those, 42 of Sebi's decisions were upheld with modifications, 21 cases were sent back to Sebi for further investigation, and 28 cases were withdrawn.
In FY24, Sebi's win rate at SAT was 67.5%; 380 out of 730 disposed appeals were dismissed and 157 appeals were allowed against Sebi.
Nearly 62% of the disposed SAT cases involved fraudulent and unfair trade practices, most of which were upheld.
At the Supreme Court, Sebi maintained its strong track record with 90% of the 80 disposed cases decided in its favor. The regulator faced 81 fresh cases during FY25, leaving 520 cases pending at the apex court at the end of March 2025.
About 76% of the cases pending before the Supreme Court were appeals challenging SAT orders, while the remaining 24% comprised writ petitions, special leave petitions, criminal appeals, and contempt petitions.
Beyond SAT and the Supreme Court, Sebi's report showed that High Court pendency in non-prosecution cases fell to 886 in FY25 from 1,162 in the year before, with 98.4% of the disposals decided in Sebi's favor.
Prosecution-related High Court pendency rose to 313 from 269, with a 74% favourable disposition rate.
Prosecution litigation refers to criminal cases where Sebi files complaints against entities for serious violations of securities laws. These cases can result in conviction, fines, or imprisonment.
Non-prosecution cases encompass all other regulatory enforcement actions, including civil proceedings for monetary penalties (adjudication), directions to cease trading, and disgorgement or surrendering of illegal gains.
In forums like civil courts, consumer fora, the National Company Law Tribunal, its appellate counterpart, and allied bodies, Sebi's pendency stood at 539 in FY25, with 92.9% of the disposals favouring the regulator.
Beyond courtroom victories, Sebi significantly stepped up its enforcement activities. Prohibitive directions under Section 11 of the Sebi Act jumped to 560 entities in FY25 from 439 in the year before.
These directions include restraining entities from accessing securities markets, freezing bank accounts, impounding proceeds of suspicious transactions, and prohibiting dealing in securities.
In FY25, pending adjudication cases, which are formal inquiries conducted by Sebi officers into securities laws violations, fell substantially to 478 from 1,236. Sebi disposed of 962 matters during the year.
Sebi initiated 287 insider trading probes in FY25, a significant jump from 175 cases in FY24, while completing investigations into 192 cases, up from 130 in the previous year.
Investigations related to market manipulations and price rigging declined to 106 cases from 160, while completions rose to 105 from 57.
Front-running cases, where brokers or their associates trade ahead of large client orders to profit from anticipated price movements, formed a major category under fraudulent and unfair trade practices.
Sebi took up 44 such cases in FY25 as compared with 83 in FY24, but completed 51 versus just 17 in the year prior.
Sebi collected ₹ 798.87 crore from 284 settled cases, more than eight times the ₹ 94.5 crore it collected in FY24. The regulator received 703 settlement applications in FY25, disposing of 284 while rejecting, returning, or seeing withdrawal of 272 applications.
Settlement allows violators to resolve matters without admitting guilt by paying predetermined charges based on the nature and severity of the alleged violations. Sebi says this frees resources for more serious matters while ensuring swift resolution.
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