The Securities Appellate Tribunal significantly increased its overturning and modifying of SEBI orders in 2025-26, as the regulator intensifies investigations into insider trading and market misconduct, despite rising case backlog and enforcement complexities.
The Securities Appellate Tribunal overturned 47 orders passed by the Securities and Exchange Board of India in 2025-26, more than double the 23 it set aside a year earlier, according to SEBI’s annual report. The tribunal also more than doubled the number of orders it modified, to 88 from 42, even as the regulator’s overall caseload remained heavy and its enforcement machinery continued to broaden.
SAT received 429 appeals during the year, down from 533 in the previous fiscal year, and disposed of 323 cases. Yet the backlog still rose, with pending appeals climbing to 1,066 by the end of March 2026 from 960 a year earlier. Of the matters decided, 148 related to the Prohibition of Fraudulent and Unfair Trade Practices rules and insider trading cases, underscoring the central role those violations continue to play in market litigation.
Lawyers said the tribunal is increasingly focused on whether SEBI has built its cases on firm evidence and whether the penalties imposed are proportionate to the alleged misconduct. “SAT appears to be examining whether SEBI’s conclusions are sufficiently tied to evidence, whether directions are proportionate, and whether each noticee’s role is individually established. It is insisting on stronger reasoning, clearer causation and better proportionality before serious market-access restrictions or monetary directions are sustained,” said Soumya Singh, co-founding partner at Thistle&Law. Vanya Singh, a partner at Cyril Amarchand Mangaldas, said disputes over access to documents still lead many cases back to SEBI, while the tribunal often trims penalties it sees as excessive.
SEBI itself stepped up enforcement activity in the year, taking up 402 investigations and completing 338, including 224 insider trading and takeover probes, 121 under PFUTP rules and 57 tied to financial statement fraud. Sumit Agrawal, founder of Regstreet Law Advisors and a former SEBI officer, said SAT tends to interfere more often with punishment and procedure than with the underlying finding of wrongdoing. “In many cases, the regulator’s conclusion is upheld, but the punishment or the reasoning supporting it is refined or recalibrated.”
Adjudication activity was also extensive, with proceedings against 640 entities concluded through 319 orders. PFUTP remained the biggest enforcement bucket, with action against 233 entities, though that was slightly below the previous year. Action under the Listing Obligations and Disclosure Requirements rules jumped sharply to 40 entities from seven, while cases involving disclosure failures under takeover and insider trading rules rose to 10 from four. Proceedings for failing to comply with summons increased to 13 from two, but cases for not following SEBI orders fell to five from 19. Penalties were not imposed on 123 entities, up from 107 in FY25.
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