Description

SEBI adjudication order against three individuals — Arvind Babulal Goyal, Pooja Arvind Goyal, and Abhay Javlekar — for violations related to substantial acquisition, insider trading, and fraudulent trade practices in Incap Financial Services Limited, remanded by SAT for fresh proceedings.

Summary

SEBI’s Adjudicating Officer issued a fresh order (No. Order/JS/VC/2025-26/32264-32266) in the matter of Incap Financial Services Limited against three noticees: Mr. Arvind Babulal Goyal (Noticee-1), Mrs. Pooja Arvind Goyal (Noticee-2), and Mr. Abhay Javlekar (Noticee-3). The proceedings arise from earlier AO orders dated April 20, 2020 and April 30, 2020, which were set aside by the Securities Appellate Tribunal (SAT) in October 2023 and remanded to SEBI for fresh adjudication.

Key Points

  • Original penalties imposed: ₹19,70,000 on Noticee-1, ₹14,00,000 on Noticee-2, and ₹18,50,000 on Noticee-3 under the SEBI Act and SCRA.
  • Noticees filed separate appeals before SAT (Appeal No. 20/2021, 19/2021, and 308/2021); SAT vide order dated October 30, 2023 set aside the original AO orders and remanded the matter to SEBI.
  • Violations alleged against Noticee-1 include breaches of SAST Regulations 1997, PIT Regulations 1992 and 2015, PFUTP Regulations 2003, and SCRA provisions.
  • Violations alleged against Noticee-2 include breaches of SAST Regulations and PFUTP Regulations.
  • Violations alleged against Noticee-3 include breaches of SAST Regulations, PIT Regulations 2015, PFUTP Regulations, and SCRA provisions.
  • The matter involves acquisition of shares without making requisite disclosures and open offers, insider trading, and fraudulent/unfair trade practices in the securities market.

Regulatory Changes

No new regulatory changes introduced. This is an enforcement/adjudication order applying existing provisions of:

  • SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997
  • SEBI (Prohibition of Insider Trading) Regulations, 1992 and 2015
  • SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003
  • Securities and Exchange Board of India Act, 1992 (Sections 15A(b), 15H, 15HA, 15HB)
  • Securities Contracts (Regulation) Act, 1956 (Sections 13, 16, 18, 23H)

Compliance Requirements

  • Acquirers of substantial stakes must comply with disclosure obligations under SAST Regulations (Regulations 7(1), 7(1A), 10, 11(1)).
  • Insiders must adhere to PIT Regulations including model code of conduct (Regulations 12(1), 12(3), 13(1), 13(3), 13(4)).
  • Market participants must refrain from fraudulent and unfair trade practices as defined under PFUTP Regulations (Regulations 3 and 4).
  • Entities involved in securities transactions must comply with SCRA provisions including SEBI Notification G.S.R.219(E) dated March 2, 2000.

Important Dates

  • April 20, 2020: Original AO order against Noticee-1.
  • April 30, 2020: Original AO orders against Noticee-2 and Noticee-3.
  • 2021: Noticees filed appeals before SAT (Appeal Nos. 19, 20, and 308 of 2021).
  • October 30, 2023: SAT set aside original AO orders and remanded matter to SEBI.
  • March 25, 2026: Fresh adjudication order issued by SEBI.

Impact Assessment

This order has limited broad market impact as it pertains to enforcement action against three specific individuals in the matter of a single company (Incap Financial Services Limited). However, it reinforces SEBI’s commitment to pursuing violations of takeover, insider trading, and fraudulent trade practice regulations even after SAT remands. The remand and fresh proceedings underscore procedural rigor in adjudication. Market participants and promoters involved in substantial acquisitions should note the sustained scrutiny of disclosure obligations and trading conduct over extended periods.

Impact Justification

Enforcement action against specific individuals for multiple violations including insider trading, fraudulent trade practices, and takeover regulation breaches; remanded by SAT for fresh adjudication, indicating procedural significance but limited broad market impact.