Supreme Court Clarifies Irrelevance of Trading Purpose Under 2015 Insider Trading Regulations
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Case: SECURITIES AND EXCHANGE BOARD OF INDIA v. RAJEEV VASANT SHETH
Court: Supreme Court of India
Date: 11-08-2026
Law: Securities and Exchange Board of India Act.
Highlights of the Judgment:
- Detailed examination of insider trading liability under Regulation 4(1) of the SEBI (Prohibition of Insider Trading) Regulations, 2015.
- Interpretation of the statutory note to Regulation 4(1) rendering the purpose or destination of trading proceeds entirely irrelevant.
- Distinction between the 2015 PIT Regulations and the 1992 Regulations regarding the defense of legitimate corporate purpose.
- Scope of SEBI's powers to direct disgorgement of avoided losses and impose penalties under Sections 11B and 15G of the SEBI Act, 1992.