SEBI v. Prafulla Bhat and others (insider trading in Prakash Constrowell, 2024)

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 July 2024 a SEBI whole-time member found that a non-executive director of Prakash Constrowell and two other individuals had traded on unpublished information about large work orders. The order restrained those three for 2 years, directed disgorgement of their gains and imposed penalties totalling Rs 34,00,000, while proceedings against the other three noticees were disposed of without directions.

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

3.4m 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

The order of 24 July 2024 was issued by SEBI whole-time member Ashwani Bhatia in the matter of Prakash Constrowell Limited, since renamed Setubandhan Infrastructure Limited. There were six noticees: the promoter Prakash Laddha, Prafulla Bhat, Pradeep Khandagale, Vishal Ahuja, Vipul Lathi and Anup Karwa. Mr Bhat was a non-executive director and designated employee of the company.

SEBI investigated trading from February to August 2016. On 25 August 2016, after the market closed, the company announced two work orders, one worth Rs 108 crore from a defence department for housing in Mumbai and one worth Rs 50 crore. SEBI alleged that the news was unpublished price sensitive information before then and that certain insiders and connected persons traded ahead of it, and that some also failed to make required disclosures under the takeover and insider trading regulations.

The order finds that Mr Bhat, Mr Lathi and Mr Karwa traded on the basis of the information, in breach of the insider trading regulations read with section 12A of the SEBI Act. It computes their wrongful gains by reference to the next day's closing price: Rs 54,71,510, Rs 55,50,000 and Rs 12,57,853 respectively. It also finds Mr Bhat made a further Rs 30,66,644 from contra trades in breach of the code of conduct, and finds disclosure failures by Mr Bhat and Mr Karwa.

The three were restrained from the securities market for 2 years and ordered to disgorge those gains to the Investor Protection and Education Fund within 45 days. Penalties were Rs 13,00,000 for Mr Bhat, Rs 10,00,000 for Mr Lathi and Rs 11,00,000 for Mr Karwa, Rs 34,00,000 in all, across sections 15G, 15A(b) and 15HB. The proceedings against Mr Laddha, Mr Khandagale and Mr Ahuja were disposed of without directions.

The record does not show whether anyone appealed, whether the disgorgement and penalties were paid, or how the three traders obtained the information beyond what the order finds. No criminal case is mentioned.

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. 2024-07-24 SEBI 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
• Order (PDF)

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.