The Securities and Exchange Board of India regulates listed companies, brokers, intermediaries and investors. A SEBI notice can lead to penalties, trading bans, disgorgement and restrictions on directors, and responding well at each stage matters.

Typical SEBI proceedings

• Investigation and summons for documents and statements.
• Show-cause notice alleging insider trading, fraud (PFUTP Regulations), takeover violations or disclosure and LODR defaults.
• Adjudication by an Adjudicating Officer for monetary penalties, or quasi-judicial orders by the Whole-Time Members or the Chairman for directions such as bans or disgorgement.

Appeal to the Securities Appellate Tribunal

Section 15T of the SEBI Act, 1992 allows any person aggrieved by a SEBI order to appeal to the Securities Appellate Tribunal (SAT) at Mumbai within forty-five days, which may be extended for sufficient cause. SAT can stay SEBI orders pending appeal and may require a deposit of part of the penalty. A further appeal on a question of law lies to the Supreme Court under Section 15Z within sixty days.

Landmark examples

In Sahara India Real Estate Corporation v. SEBI (2012), the Supreme Court upheld SEBI's jurisdiction and directed refund to investors of money raised through optionally fully convertible debentures, in one of India's largest investor-protection orders. In 2019 SEBI took action against Karvy Stock Broking for misusing clients' securities, showing the regulator's focus on client assets.

Defence strategy

• Reply in detail to the show-cause notice and seek inspection of documents relied upon.
• Challenge reliance on unrecorded material and breach of natural justice.
• Consider settlement or consent proceedings under SEBI's settlement framework, which may avoid admission of guilt.
• Preserve trading records, call data and communications.

For investors

Investors can file complaints on the SEBI SCORES platform and can approach Securities Appellate Tribunal or civil and consumer fora depending on the facts. Companies and directors should maintain compliance calendars and insider trading code records, as lapses can lead to collateral claims by shareholders.

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This article is for general information only and is not legal advice. Law and procedure change; please verify the current position for your specific case. Last reviewed: November 2026.