Description

SEBI imposes penalty on Anil Bajaj HUF for executing non-genuine reversal trades in illiquid stock options at BSE during April 2014 to September 2015, creating artificial volume.

Summary

SEBI has issued an adjudication order (Order/AK/DS/2025-26/31819) against Anil Bajaj HUF (PAN: AAMHA1069B) for violations under the PFUTP Regulations. The entity executed non-genuine reversal trades in illiquid stock options at BSE during the investigation period from April 1, 2014 to September 30, 2015. The order was issued under Section 15-I of the SEBI Act, 1992.

Key Points

  • Anil Bajaj HUF executed 2 non-genuine trades in 1 stock options contract resulting in artificial volume of 52,000 units
  • During the investigation period, 2,91,744 trades (81.40% of all trades) in BSE stock options segment were allegedly non-genuine
  • These trades created false or misleading appearance of trading through artificial volumes
  • Proceedings initiated for violation of Regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of PFUTP Regulations, 2003
  • Show Cause Notice dated August 10, 2022 issued to the Noticee
  • Adjudicating Officer: Mr. Anindya Kumar Das (initially appointed September 20, 2021; case transferred April 3, 2025)

Regulatory Changes

No new regulatory changes introduced. This is an enforcement action under existing PFUTP Regulations.

Compliance Requirements

  • Market participants must ensure all trades in stock options are genuine and not executed for creating artificial volume
  • Reversal trades in illiquid stock options that create misleading appearance of trading volume are prohibited
  • Entities must comply with PFUTP Regulations 3 and 4 requirements regarding fraudulent and unfair trade practices

Important Dates

  • Investigation Period: April 1, 2014 to September 30, 2015
  • Initial AO Appointment: September 20, 2021
  • Show Cause Notice: August 10, 2022
  • AO Transfer: April 3, 2025
  • Adjudication Order: November 28, 2025

Impact Assessment

This is an individual enforcement action with minimal market-wide impact. The order addresses historical violations from 2014-2015 in the illiquid stock options segment. The case is part of SEBI’s broader investigation into widespread non-genuine trading practices at BSE during that period, where over 81% of trades were found to be allegedly manipulative. The action reinforces SEBI’s commitment to maintaining market integrity and deterring creation of artificial volumes.

Impact Justification

Individual entity adjudication order for historical violations (2014-2015) with limited market-wide impact; specific to illiquid stock options trading at BSE