Mahesh Somabhai Desai & Others vs SEBI

IN THE SECURITIES APPELLATE TRIBUNAL
AT MUMBAI

TH
DATED THIS THE 8 DAY OF MAY, 2026

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


Appeal No.711 of 2022


1. Mahesh Somabhai Desai
B17, Chaapra, Nr. Chhaya Flat,
Somabhai Rabari Vasahat,
Ghatlodia, Ahmedabad-380061.

2. Dhiren Dharamdas Agrawal HUF
13, Sharda Nagar Society,
Opp. Bhimnath Mahadev,
Paldi, Ahmedabad-380007.

3. Janakray Vithaldas Soni
36, Anurag Bungalow,
SVM School Lane,
Science City, Sola,
Ahmedabad-380060.























…Appellants

(By Mr. Kunal Katariya, Advocate with Ms. Jyoti Pandey, Advocate
i/b. Lexkare Legal for Appellants . )


Securities and Exchange Board of India
Plot No.C4-A, G-Block,
Bandra Kurla Complex,
Bandra (East), Mumbai-400051.



…Respondent

2

(By Mr. Suraj Chaudhary, Advocate with Ms. Khushbu Chhajed,
Ms. Khushbu Trivedi and Mr. Pulkit Awasthi, Advocates i/b. MDP
Legal, Advocates for the Respondent . )


With
Appeal No.712 of 2022


1. Vipul Jigisha Bundela
9, Bansi Park Society,
Patel Vas, Kochrab,
Ellisbridge, Ahmedabad-380006.

2. Khyati Vipulkumar Bundela
9, Bansi Park Society,
Patel Vas, Kochrab,
Ellisbridge, Ahmedabad-380006.

3. Jigisha Bundela
9, Bansi Park Society,
Patel Vas, Kochrab,
Ellisbridge, Ahmedabad-380006.

4. Jitendra Hasmukhlal Vyas
M-23-272, Darshan Apartment,
Block No.1 to 30,
Naranpura, Ahmedabad-380063.


































…Appellants

(By Mr. Kunal Katariya, Advocate with Ms. Jyoti Pandey, Advocate
i/b. Lexkare Legal for Appellants )
.

Securities and Exchange Board of India
Plot No.C4-A, ‘G’ Block,
Bandra Kurla Complex,
Bandra (East), Mumbai-400051.





…Respondent
(By Mr. Suraj Chaudhary, Advocate with Ms. Khushbu Chhajed,
Ms. Khushbu Trivedi and Mr. Pulkit Awasthi, Advocates i/b MDP
Legal, Advocates for the Respondent . )

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THESE APPEALS ARE FILED UNDER SECTION 15T OF THE
SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 TO
SET ASIDE THE ORDER DATED MAY 31, 2022 PASSED BY THE
AO, SEBI

THESE APPEALS HAVING BEEN HEARD AND RESERVED FOR
ORDERS ON APRIL 17, 2026 COMING ON FOR PRONOUNCEMENT
OF ORDER THIS DAY, THE TRIBUNAL MADE THE FOLLOWING:

ORDER

Per: Justice P. S. Dinesh Kumar, Presiding Officer

These two appeals are directed against order dated
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31.05.2022 passed by the AO , SEBI imposing penalties on the
appellants mentioned in para 32 of the impugned order for
violation of the Securities laws.

2. Brief facts of the case are:

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a) Based on SCORES complaints, SEBI conducted an
investigation into the scrip of Shree Global Tradefin Limited
(‘SGTL/Company’ for Short) for the period between
29.08.2011 and March 30.03.2012.

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b) SEBI issued three SCNs . The first SCN was issued on
20.04.2012 for the investigation period between
01.03.2009 and 30.11.2009. After adjudication, AO passed

1
Adjudicating Officer
2
Securities and Exchange Board of India
3
SEBI Complaints Redress System

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Show Cause Notice

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order dated 14.09.2012, imposing a penalty of ₹30 Lakh
each on one Sanjay Soni and his wife, Krupa Soni. The said
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order was challenged in this Tribunal and this Tribunal
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vide order dated 24.01.2014 reduced the penalty from
₹30 Lakh to ₹10 Lakh each.

c) SEBI issued second SCN on 20.07.2017 for the
investigation period between 01.04.2010 and 10.01.2011.
After adjudication, AO passed order dated 25.10.2018
imposing penalties on Sanjay Soni and others, the said
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order was set aside by this Tribunal .

d) The present appeal is filed against the impugned order
arising out of the third SCN dated 12.02.2021 for the
investigation period between 29.08.2011 and 30.03.2012
issued by SEBI.

e) Noticee Nos.1 to 6 were buyers who repeatedly placed
‘buy’ orders at prices higher than the Last Traded Price
(‘LTP’ in short), which resulted in increase in price. Noticee
Nos.7 and 8 were the sellers and the ‘sell’ orders placed by
them were frequently matched with the ‘buy’ orders placed
by Noticee Nos.1 to 6. Noticee No.9 was the authorised
person, who placed the orders on behalf of Noticee No.2.

f) SEBI found that the price of the scrip significantly
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increased by 66% from ₹232.70 to ₹387.30 within a

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order dated 14.09.2012
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in Appeal No.32 of 2013
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in Appeal No.102 of 2019, decided on 14.11.2019
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on 29.8.2011

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short span of 17 trading days and thereafter, declined
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sharply to ₹105.90 . Thus, SEBI concluded that the
Noticees had manipulated the price of the scrip and
violated Securities laws. After adjudication of SCN, AO has
imposed penalties on nine Noticees. Seven out of the nine
Noticees have challenged the impugned order in these two
appeals. Appeal No.711 of 2022 is filed by Noticee Nos.2, 4
and 5, Appeal No.712 of 2022 by Noticee Nos.6 to 9.

3. We have heard Mr. Kunal Katariya, learned Advocate for
the appellants and Mr. Suraj Chaudhary, learned Advocate for the
SEBI.

4. Mr. Katariya submitted that in this case, the investigation
period is between 29.08.2011 and 30.03.2012. SEBI appointed
an AO in 2015 and he did not initiate any proceedings. After his
superannuation, another AO was appointed and he issued an
SCN on 12.02.2021. Thus, there is a delay of 10 years in issuing
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the SCN. He relied upon SEBI v. Sunil Krishna Khaitan & Ors
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and Ashlesh Gunvantbhai Shah v. SEBI and prayed for setting
aside the impugned order.

5. In reply, Mr. Suraj Chaudhary for SEBI submitted that
appellants have failed to demonstrate prejudice, if any, caused
due to delay in the proceedings. He submitted that violation of

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on 23.9.2011
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on 30.3.2012

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Civil Appeal No.8249 of 2013, decided by the Hon’ble Supreme Court of
India on 11.07.2022
12
Appeal No.169 of 2019, decided on 31.01.2020 by the Securities
Appellate Tribunal, Mumbai

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Securities laws affects innocent investors and therefore, some
latitude must be given to the Regulator. He relied upon SEBI v.
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Bhavesh Pabari , Hindustan Times Limited v. Union of India &
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Ors and Pratik Minerals Pvt Ltd. v. SEBI .

6. We have carefully considered the rival contentions and
perused the records.

7. Admitted position is, the scrip involved is SGTL. SEBI
conducted investigation for the period 01.03.2009 and
30.11.2009 and held Sanjay Soni and others guilty of violation of
Securities laws. Upon challenge, this Tribunal reduced the
penalty in that case.

8. The second investigation period is between 01.04.2010
and 10.01.2011. For that period, SEBI issued SCN after seven
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years and adjudicated the matter and imposed penalties on the
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Noticees. Upon challenge, this Tribunal set aside SEBI’s order
holding that there was an inordinate delay in initiating
proceedings.

9. The instant case is even worse. The investigation period is
between 29.08.2011 and 30.03.2012. The first AO was
appointed 21.10.2015 and he slept over the matter till his
retirement. SEBI appointed another officer, who has passed the
impugned order on 31.05.2022.

13
(2019) 5 SCC 90
14
(1998) 2 SCC 242
15
2018 SCC Online SAT 274
16
AO Order dated 25.10.2018
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in Appeal No.102 of 2019, decided on 14.11.2019

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10. The chronology of events clearly shows that SEBI has
conducted three different investigations in a piece-meal manner
in respect of very same scrip for the period between March, 2009
and March, 2012. The second adjudication order passed in 2018
has been set aside by this Tribunal in 2019 on the ground of
inordinate delay. Yet, SEBI issued the third SCN in flagrant
disrespect to the view expressed by this Tribunal in Sanjay
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Jethalal Soni and Ors. v. SEBI in respect of the second SCN.
This conduct of SEBI is deprecated.

11. In the facts recorded hereinabove, this appeal deserves to
be allowed only on the ground of delay and it is accordingly
allowed .

12. Pending interlocutory application(s), if any, stand
disposed of. No costs.



Justice P.S. Dinesh Kumar
Presiding Officer


Ms. Meera Swarup
Technical Member



Dr. Dheeraj Bhatnagar
Technical Member

08.05.2026
RHN
Digitally signed by PRERNA MANISH KHARE
Date: 2026.05.08 16:36:19 +05'30'
PRERNA MANISH KHARE

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Appeal No.102 of 2019