Vikas Sarda HUF vs SEBI

IN THE SECURITIES APPELLATE TRIBUNAL AT
MUMBAI

TH
DATED THIS THE 4 DAY OF MARCH 2026

CORAM : Justice P. S. Dinesh Kumar, Presiding Officer
Ms. Meera Swarup, Technical Member
Dr. Dheeraj Bhatnagar, Technical Member


Appeal No. 60 of 2025
And
Misc. Application No. 552 of 2025

Between


Vikas Sarda
Anand Nagar, Maglana Road,
Makrana Rajasthan – 341 505.


…. Appellant


By Mr. Ram Awatar Dhoot, Authorized Representative for the
Appellant.

And

Securities & Exchange Board of India
SEBI Bhavan, Plot No. C-4A, G Block,
Bandra Kurla Complex,
Bandra (East),
Mumbai - 400 051.




…. Respondent

By Ms. Gulnar Mistry, Advocate with Ms. Khushbu Chhajed,
Ms. Khushbu Trivedi, Advocates i/b MDP Legal for the
Respondent.

With
Appeal No. 152 of 2025
And
Misc. Application No. 332 of 2025
And
Misc. Application No. 333 of 2025

2
Between


Preeti Sarda
Anand Nagar, Maglana Road,
Makrana Rajasthan – 341 505.


…. Appellant


By Mr. Ram Awatar Dhoot, Authorized Representative for the
Appellant.

And


Securities & Exchange Board of India
SEBI Bhavan, Plot No. C-4A, G Block,
Bandra Kurla Complex,
Bandra (East),
Mumbai - 400 051.




…. Respondent


By Ms. Gulnar Mistry, Advocate with Ms. Khushbu Chhajed,
Ms. Khushbu Trivedi, Advocates i/b MDP Legal for the
Respondent.

With
Appeal No. 129 of 2025

Between

Vikas Sarda (HUF)
Anand Nagar, Maglana Road,
Makrana Rajasthan – 341 505.


…. Appellant


By Mr. Ram Awatar Dhoot, Authorized Representative for the
Appellant.

And

Securities & Exchange Board of India
SEBI Bhavan, Plot No. C-4A, G Block,
Bandra Kurla Complex,
Bandra (East),
Mumbai - 400 051.




…. Respondent

3
By Ms. Gulnar Mistry, Advocate with Ms. Khushbu Chhajed,
Ms. Khushbu Trivedi, Advocates i/b MDP Legal for the
Respondent.

THESE APPEALS ARE FILED UNDER SECTION 15T OF
SEBI ACT, 1992 TO SET ASIDE ORDER DATED
NOVEMBER 28, 2024 (EX-A) PASSED BY AO, SEBI.

THESE APPEALS HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON FEBRUARY 12, 2026, COMING ON FOR
TH
PRONOUCEMENT OF ORDER THIS 4 DAY OF MARCH
2026, THE TRIBUNAL MADE THE FOLLOWING :

O R D E R


[Per: Dr. Dheeraj Bhatnagar, Technical Member]

These three appeals are directed against the order
1 2
dated November 28, 2024 passed by the QJA , SEBI issuing
directions for disgorgement of Rs. 1.43 Crore on joint and
several basis, debarment from accessing the securities
market and imposing penalty of 5 lakhs against each of the
3
appellants under Section 15HA of the SEBI Act, 1992 (“SEBI
Act” for short).

a) Appeal No. 60/2025 is filed by one Vikas Sarda
(Noticee No. 3).

b) Appeal No. 129/2025 is filed by Vikas Sarda HUF
whose karta is Vikas Sarda (Noticee No 4).

c) Appeal No. 152/2025 is filed by Preeti Sarda, wife of
Vikas Sarda (Noticee No. 5).


1
Quasi-Judicial Authority
2
Securities and Exchange Board of India
3
Securities and Exchange Board of India Act, 1992

4
2. As these appeals arise out of a common impugned order,
these were heard together and are being disposed of way by
this common order. For convenience, appellant in all the three
appeals are collectively referred to as “appellants”.

3. Brief facts of the case are:

a) On surveillance, SEBI suspected front-running activity,
based on which it conducted investigation into trades of
the appellants and three others.

b) Investigation period was January 1, 2022 to June 30,
2023 (“IP” for short).

4
c) A SCN was issued on June 28, 2024, inter alia, alleging
5
that the trades of certain Big Clients were front-run by
the appellants and two others and one Ashish Sarda
(Noticee No. 6 in impugned order), who is cousin
brother of Vikas Sarda. Allegedly, Ashish Sarda used to
place orders of Big Clients through Thar Share Brokers
Pvt. Ltd. He was found to be the information carrier
based on which appellants front-run the impugned
transactions.

d) The Big Clients were found to be connected to each
other through common registered address and common
directors namely Ajay Gangwal and Rakhi Gangwal,
who were husband and wife.

e) Instructions of punching orders in the system for all the
three Big Clients were given by Ajay Gangwal to Ashish
Sarda. Accordingly, it was alleged that Ashish Sarda is

4
Show Cause Notice
5
Parshvanath Finvest Pvt Ltd, Thar Share Brokers Pvt Ltd and Gangwal
Commodities Pvt Ltd

5
the link between the Big Clients and the appellants and
was aware of the orders being placed on behalf of the
Big Client. Hence he is alleged to be the Information
carrier.

6
f) CDR also revealed that Vikas Sarda spoke to Ashish
Sarda prior to placing orders on various instances. Also,
call recording revealed more evidence.

g) Trade instances also revealed that many trades
undertaken by the appellants were based on the
information provided by Ashish Sarda.

h) Bank statements of the appellant revealed that an
amount of Rs 13.8 Lakhs was transferred every week
to Ashish Sarda during the IP.

i) In view of the above, the appellants were asked to
explain as to why directions for disgorgement of
wrongful gain to the tune of 1.27 Crore on joint and
several basis for the Noticee Nos. 4 and 5, may not be
issued.

j) Appellants replied to the SCN and were heard on
October 16, 2024. Thereafter, they submitted their
written submissions

4. We have heard Mr. Ram Awatar Dhoot, learned
Authorised Representative for the appellants and Ms. Gulnar
Mistry, learned advocate with Ms. Khushbu Chhajed, Ms.
Khushbu Trivedi, learned Advocate for the SEBI, in all the
appeals.


6
Call Data Record

6
5. Mr. Ram Awatar Dhoot, learned Authorized
Representative submitted that families of Ashish Sarda and
of the appellants are different; they reside in different cities
and that merely having family connections is not enough to
attribute the allegation of fraud. He submitted that the trades
executed by Preeti Sarda were independent trades and she
had no connections with the Big Clients. He submitted that
violations are technical in nature.

6. He further submitted that the statements against the
appellant cannot be used adversely without giving an
opportunity of cross-examination. He relied on Andman
7
Timber Industries vs. CCE and ITO vs. Asok Kumar
8
Bansal along with other judgments. The call recording
between Ashish Sarda and one Murari Lal Sarda (Noticee No.
1 in the impugned order) has no evidentiary value as same
was not substantiated by the appellants. He further submitted
that no person who is accused of an offence shall be
compelled to be a witness against himself.

7. Mr. Dhoot submitted that serious charges of fraud
cannot be leveled by SEBI in casual manner and suspicion of
SEBI cannot replace evidentiary documents. To support this,
9
he relied on KSL & Industries v. SEBI and CIT v.
10
Daulatram Rawatmull . Further, he submitted that there
is no evidence to prove that Murari Lal Sarda made any calls
to the appellants. A notice on a tippee is bad in law, because
no penal provision exists to punish a tippee. He relied on
11
State of Punjab v. Davinder Pal Singh Bhullar .

7
[2015] 62 taxmann com 3 (Sc)
8
ITA No. 289/Agra/2009 (Agra ITAT)
9
2005 (59) SCL 1 SAT
10
87 ITR 349 (SC)
11
Order in Criminal Appeal Nos. 753-755 of 2009 dated December 7,
2011

7

8. He submitted that ‘ intention’ is pre-requisite to prove
12
‘ fraud’ for violation of PFUTP Regulation , in the present
case, offences alleged are serious which require evidence of
‘fraud or deceit’ and are not just ordinary civil defaults. He
submitted that huge penalty of 5 Lakh is imposed in the
aftermath of COVID-19 which puts monetary burden on the
appellants.

9. He submitted that impugned order failed to consider
13
principles laid down in P.G Electroplast ltd. v. SEBI ; AO,
14
SEBI v. Bhavesh Pabari and Piramal Enterprises ltd v.
15
SEBI . He submitted that SEBI has failed to consider that
there was no impact analysis of the effects of the trades of
the appellants and the allegations are general in nature. The
penalty imposed on the appellants is disproportionate
compared to other similar cases.

10. Ms. Gulnar Mistry and Ms. Khushbu Chhajed, learned
Advocates for the SEBI, submitted that all 3 appellants are
admittedly connected and Vikas Sarda was authorized to
place orders for his wife and as Karta for his HUF account. He
has placed orders on their behalf, while no trading activity
was observed in his own account.

11. They further submitted that Vikas Sarda, in his
statement on oath before SEBI, has admitted that Ashish
Sarda used to give tips to him on the basis of which he used
to carry out trades on behalf of HUF and his wife. Bank
account statements revealed that there was a financial

12
SEBI Prevention of Fraud and Unfair Trade Practices Regulations
13
Order in appeal No. 281 of 2017 dated February 2, 2019
14
(2019) 5 SCC 90
15
Order in appeal No. 466 of 2016 dated May 15, 2019

8
arrangement between Ashish Sarda and Vikas Sarda, under
which during the IP, Vikas Sarda used to transfer Rs. 13.8
Lakhs to Ashish Sarda on weekly basis as a consideration for
sharing the information.

12. The Learned advocates for the SEBI submitted that
there is sufficient evidence on record to prove that appellants
were involved in front running, which is supported by the
CDR, statements on oath of Ashish and Vikas Sarda, bank
account statements and trading pattern of appellants and
their family relations with Asish Sarda. Appellants have made
profits of Rs. 1.27 Crore on the basis of prior information of
upcoming trades of Big Clients. The penalty imposed on the
appellants under Section 15HA is minimum and cannot be
held as excessive. Further, the facts of this case are distinct
and distinguishable from various case laws relied upon by the
appellants. They prayed that the appeal may be dismissed.

13. We have heard both the parties and perused the
records made available to us and carefully considered facts.

14. Undisputed facts of the case are:

i. All 3 Appellants are related to Ashish Sarda through
Vikas Sarda, who is his cousin brother.

ii. Ashish Sarda is privy to trades of Big clients and has
carried the information to Vikas Sarda.

iii. The trades of the appellants are in sync with Big
clients.

iv. There was fund transfer of around Rs. 13.86 Lakhs
on weekly basis to Ashish Sarda by the appellant,
statedly as commission.

9

v. Appellants have earned profits to the tune of Rs. 1.27
Crore through these trades.

15. Ashish Sarda was examined by the Investigating
Authority and his statement was recorded on oath on October
25, 2023. In his reply to the following questions, he has
furnished specific details of modus operandi as under:

“2. What is your main source of income? What is
your job profile. Who is you reporting boss?

Answer: I am working as an employee (dealer)
with Thar Share brokers earning monthly gross
salary of Rs. 22,600/. I execute all trades on
behalf of Sh Ajay Gangwal, director of Thar
Share Brokers. All instructions regarding the
trades are given by him.

5. Do you give tips to your family members for
trading in the securities market?

Answer: I do give tips to my immediate
relatives and friends for trading.

6. Are you privy to the trades of Thar Share
Brokers and do you share information about
those trades with your father/ mother or any of
the family members?

Answer: I have the ID for cash market trades.
I sit across Sh Gangwal and most of the stock
trades in cash and equity segment are executed
by me. The CTCL terminal used by me for
placing trades of behalf of entities controlled by
Ajay Gangwal for cash is in the name of
Navratan Parikh and F & O is in the name of
Jaideep Parikh. I give tips to my father through
SMS or calls. My father operates my mother's
trading account as well. His broker is in Barkat
Nagar. He gives orders at the broker's office.

7. Who is Vikas Sarda? Do you give tips to him as
well?

10
Answer: Vikas Sarda is the son of my elder
paternal uncle. He lives in Makrana. I have good
relations with him. I do give him tips through
SMS and phone calls. I used knowledge of Sh
Ajay Gangwal and informed my relatives of
somewhat guaranteed profits in the scrips. I
have seen that all such traces of Ajay Gangwal
were profitable. I have been giving him tips
since about a year. I have made a commission
of about cash 27-28 lakhs, A/c 10 lakhs.

8.There are banking transactions from Vikas
Sarda's wife, Preeti Sarda's account marked as
commission to you? What are those
transactions referring to?

Answer: The transactions are the commission
arrangement I had with Vikas Sarda for giving
him tips in 60:40 ratio post taxes and other
mandatory outgo. Infact, I had such
arrangement with Ashok Jajoo as well. I would
receive commission in cash as well. I have used
part of that amount in buying current house
which is in my father's name and for alimony
(jewellery) to my ex-wife.

9. Did you give tips to Vikas Sarda to close his
trades intra-day by trading ahead of the trades
of entities related to Ajay Gangwal?

Answer: I did inform him of the scrips in which
Gangwal ji would continuously invest so he
would also take similar position. For eg. If
Gangwal ji was buying 10,000 of BHEL and
continued buying it then I would accordingly
inform my brother, Vikas since I trusted the
decision of Gangwal ji. If he was continuously
buying, it would mean that it would be a
profitable position.”
[Emphasis supplied]


16. Further, Vikas Sarda was also examined on oath by the
Investigating Authority on December 8, 2023 where he has
made the following critical admissions in his statement, which
corroborate the contentions of Ashish Sarda:

11

“6. Did you get tips from Ashish Sarda for trading
in the securities market? How and when did
this start?

Answer: Yes. Ashish is my cousin. He knew I
was interested in share market. He offered to
give me tips on the basis of which I could
trade. This started in around mid of 2022.

7. How was the information about trades
communicated to you?

Answer: Ashish would share the information
either through phone calls or SMS or
whatsapp.

8. Did you give any commission to Ashish Sarda
for sharing the information? What was the
mode of transfer of money? Give details
regarding the same.

Answer: Yes. initially I had deposited some
cash and mostly it was through online transfer
either from the account of my HUF or my wife.

There was no specific percentage. He had
asked me to give him commission on whatever
I felt appropriate and settle them on
Saturdays. Accordingly, I would transfer some
money to his account. If there was loss, he had
refunded my money also on one or two
occasions.”
[Emphasis supplied]


17. We note that the appellants have not disputed the
above statement. Vikas Sarda’s statement corroborate with
the statements of Ashish Sarda. It is admitted by both the
tipper and tipee that the trades carried out by the appellants
were based on the tips given by Ashish Sarda, who has
confirmed that these were based on stock trades for big
clients conducted by him in cash and equity segments, while
he was working at Thar share Brokers. He has stated that he

12
used to pass on information to Vikas Sarda through Phone,
whatsapp or text SMS, and the appellants used to pay
commission to him on weekly basis. Thus, the evidences on
record, establish admission by both tipper and the tippee of
being engaged in unethical front-running practice.

18. The Learned Authorised representative of the appellants
has argued that the statements against the appellant cannot
be used adversely without giving an opportunity of cross-
examination of Ashish Sarda and relied on Andman Timber
16 17
Industries vs. CCE and ITO vs. Asok Kumar Bansal .

19. We note that, appellants have not taken this stand
before the AO. Secondly, before the AO appellants had sought
cross-examination of only 4 entities namely; NSE,
Parshvanath Finvest Pvt. Ltd., Thar Share Brokers Pvt. Ltd.
and Gangwal Commodities Pvt. Ltd and not of Ashish Sarda.
It is only at the appellate stage that the appellants have taken
this stand.

We also note that the appellants have not disputed the
connections with Ashish Sarda and the contents of CDRs.
Appellants have failed to explain as to why an amount of Rs.
13.86 Lakhs was transferred to Ashish Sarda on weekly basis
during the investigation period. We have extracted relevant
portion of Vikas Sarda’s statement made on oath in para No.
16 above. He has admitted to have received tips from Ashish
and paid commission to him. Therefore, there is no need for
cross-examination of Ashish.


16
[2015] 62 taxmann com 3 (Sc)
17
ITA No. 289/Agra/2009 (Agra ITAT)

13
20. Mr. Dhoot also submitted that the impugned order
passed by the SEBI is based on SEBI’s suspicion and cannot
take the place of proof. The said argument is untenable
because, appellant Vikas Sarda has admitted the modus
operandi in his statement on oath. The next plea of excessive
penalty is also untenable since minimum penalty has been
levied against the appellants under Section 15HA. Appellants
have not urged any ground with regard to computation of
disgorgement amount on joint and several basis.

21. In view of above discussion, we find no merit in the
appeal. Hence, the following:-

ORDER

i. Appeal Nos. 60 of 2025, 152 of 2025 and 129 of
2025 are dismissed.
ii. Pending interlocutory application(s), if any, stands
disposed of.
iii. No costs.

Justice P. S. Dinesh Kumar
Presiding Officer


Ms. Meera Swarup
Technical Member


Dr. Dheeraj Bhatnagar
Technical Member
04.03.2026
PTM

MRS
PRAMILA
Digitally signed
by MRS PRAMILA
Date: 2026.03.04
11:43:04 +05'30'