P&H High Court Halts SEBI's IEX Insider Trading Probe

10 hours ago 24

The Punjab and Haryana High Court on April 10 halted SEBI's proceedings against eight individuals accused of insider trading in the shares and derivatives of Indian Energy Exchange Ltd (IEX), granting interim relief in one of the regulator's largest recent enforcement actions involving INR 173.14 crore in alleged unlawful gains.

In a two judge bench order passed by Justices Suvir Sehgal and Yashvir Singh Rathor, the court has issued notice to SEBI and other respondents, setting the next hearing for July 30, 2026. "All proceedings pursuant to the impugned order shall remain stayed until the next date of hearing," the bench directed, providing immediate relief to petitioner Bhoovan Singh (one of the key accused) and the seven others.

Senior advocate Chetan Mittal, appearing alongside advocates Himanshu Gupta and Ritvik Garg, argued the matter on behalf of Singh. Counsel placed reliance on the rulings in M/s Nel Holding South Limited vs SEBI (2025) and Sunita Agarwal vs SEBI (2022) in support of the petitioner's case.

The case traces back to July 23, 2025, when the Central Electricity Regulatory Commission (CERC) announced its market coupling order after market hours. This mechanism pooled buy and sell bids across power exchanges for a uniform clearing price, directly challenging IEX's short-term trading dominance. IEX shares crashed 29.58 percent the next day.

SEBI's suo motu probe followed a complaint alleging trades based on unpublished price sensitive information (UPSI). On September 12, 2025, it invoked Section 11C of the SEBI Act, claiming "reasonable grounds to believe" insider activity.

In its subsequent interim order dated 15 October 2025, SEBI barred all eight individuals from the securities market and directed disgorgement of INR 173.14 crore in alleged illegal gains.

The High Court has now sought responses from SEBI and other respondents. Pending the next hearing, all proceedings against the noticees covered by the petition remain stayed.