SEBI’s annual report signifies increase in settlement pleas

SEBI’s annual report signifies increase in settlement pleas

The mechanism allows entities to resolve cases by paying a fee and complying with conditions

In its 2024-25 annual report, the Securities and Exchange Board of India (SEBI) has stated seeing a significant increase in settlement pleas, receiving 703 applications to settle violations of norms. This indicates a trend towards resolving disputes without going into a lengthy litigation procedure.

While the market regulator disposed of 284 cases by passing appropriate settlement orders, 272 applications were returned, rejected, or withdrawn.

In the 284 orders, it collected Rs.798.87 crores towards settlement, in addition to Rs.64.84 crores as disgorgement charges.

The orders were issued for alleged violations of various regulations, including insider trading, fraudulent trading practices, Alternative Investment Funds (AIFs), mutual funds, and Foreign Portfolio Investors (FPIs).

The regulator also dealt with 533 new appeals filed before the Securities Appellate Tribunal (SAT) in 2024-25, compared with 821 in the previous financial year. In FY 2023-24, it received 434 settlement pleas.

Of the new appeals, 422 were disposed of, with 308 appeals (73 percent) dismissed, 23 appeals (5 percent) allowed, 42 appeals (10 percent) upheld with modification, 21 appeals (5 percent) remanded, and 28 appeals (7 percent) withdrawn.

A majority of the disposed appeals (nearly 62 per cent) related to violations of the SEBI Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Regulations, 2003.

Meanwhile, the ‘difficult-to-recover’ (DTR) dues reached Rs.77,800 crore in FY 2025, up from Rs.76,293 crore at the end of March 2024. These dues remain unrecovered despite efforts.

The market regulator clarified that segregation of DTR dues was an administrative act. It did not prevent recovery officers from pursuing the matter if there was a change in the underlying parameters.