SEBI v. Pallavi Navinchandra Mehta and others (insider trading, ADF Foods buyback, 2022)

Judgment entered

✓ Checked against the primary document on October 8, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, in a single reading of the order; an independent second reading of 60 SEBI records agreed on every field for 56, the four misses being penalty amounts; a later sample of 50 of the SEBI records added on 9 October agreed on every field for 46. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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In June 2022 a SEBI adjudicating officer imposed a joint penalty of Rs 40 lakh on six people for trading in ADF Foods shares ahead of a 2016 buyback announcement. The order found that an executive director of the company funded and passed information to relatives and associates whose trades earned about Rs 77 lakh combined.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

—

Alleged gain

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Penalty as published

4m INR

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars. This regulator states penalties in INR. The figure is recorded as published and is not converted, so it does not appear in the USD totals or medians used elsewhere on this site.

What is alleged to have happened

An adjudicating officer of SEBI issued this order on 23 June 2022 against six noticees in the matter of ADF Foods Ltd, a food company listed on NSE and BSE. Bhavesh R. Thakkar was the company's executive director. The others were his wife Priyanka Thakkar and four associates, Pallavi Navinchandra Mehta, Shefali Bhupendra Mehta, Navin Mansukhlal Mehta and Abhishek Mehta. The show cause notice was dated 2 May 2019 and followed an NSE alert.

SEBI treated the buyback plan as unpublished price sensitive information from 21 May 2016, when it was first discussed with a merchant banker, until 27 July 2016, when the board approved a buyback of 14.4 lakh shares at up to Rs 125 a share. It alleged that Mr Thakkar passed the information on and funded trading by Ms Pallavi Mehta and Ms Shefali Mehta, that his wife's account was used as a conduit, and that the other noticees placed orders through accounts at one broker.

The order finds the noticees liable for insider trading under section 12A(d) and (e) of the SEBI Act and Regulation 4(1), and for Mr Thakkar also Regulation 3(1), of the Prohibition of Insider Trading Regulations. SEBI's notice put the unlawful gains of the two traders at about Rs 37.86 lakh and Rs 39.37 lakh, though the officer said individual gains were not quantifiable on the present facts.

A single penalty of Rs 40,00,000 was imposed on all six noticees jointly and severally under section 15G of the SEBI Act, payable within 45 days. The officer noted that a whole-time member had in March 2021 directed disgorgement of Rs 77,23,637 with interest and had restrained the noticees from the securities market for periods of three to six months, and took those into account. Those earlier orders are separate from this one.

The record does not show whether the penalty or disgorgement was paid or appealed, and the order does not mention a criminal case.

This library tags the matter as insider trading. The tagging is ours, not the regulator's.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the order.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Insider trading — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2022-06-23 SEBI adjudication order

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEBI order

The linked release is published by the issuing regulator under its own terms. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added October 8, 2026. submit a correction.