SEBI adjudication orders on illiquid stock options at BSE (2023 batch)

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. 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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SEBI adjudicating officers issued 860 orders in 2023 on reversal trades in illiquid BSE stock options in 2014-15. The sampled client orders each impose Rs 5,00,000 under section 15HA, one broker was penalised Rs 2,00,000 for weak surveillance, and one proceeding abated on the noticee's death.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

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Alleged gain

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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.

What is alleged to have happened

This record groups 860 separate SEBI adjudication orders published between 2023-01-10 and 2023-12-29, each issued by an adjudicating officer to one noticee (or a small group) in the matter of dealings in illiquid stock options at BSE. It is read from a sample of orders, not from all 860; the individual noticees beyond the sample are not named here.

SEBI's investigation covered stock options trading on BSE between April 2014 and September 2015. It found that most trades in that segment, roughly 2.9 lakh trades or more than 81 percent, were reversals: a client bought or sold a contract and then took the opposite position with the same counterparty on the same day, often at prices that differed sharply. SEBI treated these trades as non-genuine because ownership did not meaningfully change hands, and said they inflated reported volume in contracts that otherwise barely traded. The investigation identified about 14,720 entities that executed such trades, and each was pursued in a separate adjudication proceeding.

In each order SEBI alleged that the noticee's trades created a false or misleading appearance of trading and breached Regulations 3(a) to (d), 4(1) and 4(2)(a) of the PFUTP Regulations 2003, and the adjudicating officer, after a show cause notice and a hearing opportunity, found the violation proved and penalised the noticee under section 15HA of the SEBI Act. Several of the later orders note that the noticee had first been offered SEBI's settlement scheme. Five orders were sampled. Sudhir Shah (22 August 2023) was alleged to have made 4 non-genuine trades on 2 days in 2 contracts. Om Prakash Dalmia (23 June 2023) was alleged to have made 15 such trades in 4 contracts, creating 14,88,000 units of artificial volume. Om Prakash Poddar Others (30 August 2023) was alleged to have made 6 trades in 3 contracts, creating 1,40,500 units. The late Rumela Gupta (4 May 2023) had died in 2016, and her proceeding was abated without a decision on the merits. CPR Capital Services Ltd. (17 May 2023) is a trading member rather than a trading client.

The three client orders each impose Rs 5,00,000 under section 15HA. The CPR Capital order is different in kind: the adjudicating officer penalised the broker Rs 2,00,000 under section 15HB for failing to run a system that flagged reversal trades by its clients, a compliance failing rather than the trading itself. The sampled range is therefore nil (the abated proceeding) to Rs 5,00,000, with Rs 2,00,000 for the broker. The 2023 batch is the largest of the five, and the record does not show how many of its orders are broker or abatement orders.

The record does not show the outcome of any appeal to the Securities Appellate Tribunal, whether penalties were paid, the profit or loss of any noticee, or the circumstances of noticees outside the sample. Because the penalties are set by statute for each noticee, no total for the batch is stated here.

This library tags the batch as matched orders, because the conduct found was pre-arranged reversal trades between the same parties. 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.

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

Timeline

1. 2023-01-10 First order of the year in the batch published
2. 2023-12-29 Last order of the year in the batch published (860 orders in 2023)

Primary documents

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

• First order in the batch (SEBI order page)
• Last order in the batch (SEBI order page)
• SEBI adjudication orders listing

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.