Individual pays Rs 45 lakh to settle case with Sebi, also agrees to non-monetary terms

An individual has settled proceedings with Sebi by paying Rs 45.23 lakh towards settlement charges and agreeing to comply with two "non-monetary terms" regarding alleged insider trading activities in USL shares few years ago.

In March 2017, Sebi issued a show cause notice to Nishat Shailesh Gupte for alleged insider trading activities in the scrip of United Spirits Ltd (USL) on the basis of unpublished price-sensitive information.

The move followed a Sebi investigation in USL scrip.

Pending adjudication proceedings, Gupte had submitted a settlement application with the regulator.

At the same time, Sebi passed an order in January 2020 against the individual on the basis of the same investigation.

Gupte moved the Securities Appellate Tribunal (SAT) against the order and while the appeal was pending, filed another settlement application with Sebi.

In August 2020, an internal committee on settlement calculated the terms to settle both proceedings -- appeal before the SAT and present adjudication proceedings.

The settlement amount of Rs 45,23,500 was decided. The internal committee also formulated two non-monetary terms requiring the individual to ensure voluntary compliance with certain directions passed by Sebi in January 2020, according to the regulator's order issued on Tuesday.

The non-monetary terms included not buying, selling or otherwise dealing in securities markets for seven years as well as not associating with any listed company registered with Sebi for seven years.

The individual proposed payment of the amount towards "full and final settlement of all regulatory, civil or criminal proceedings in relation to the facts contained in the SCN (show cause notice) without admitting or denying any violation on the part of the applicant (Gupte)".

"The applicant also agreed for voluntary compliance of non-monetory terms," the order said.

SAT also approved the settlement terms and disposed of the appeal filed against Sebi's January order.

According to Tuesday's order, Gupte has paid Rs 45.23 lakh towards the settlement fee and has also agreed for voluntary compliance of the non-monetary terms.