Insider trading case: SAT quashes Sebi's order against Kishore Biyani, others

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Securities Appellate Tribunal (SAT) on Wednesday quashed regulator Sebi's order banning Future Retail chairperson Kishore Biyani and some other promoters from the securities market for one year in an insider trading case. Dismissing the Sebi's order, the appellate tribunal said that the entities did not trade in the shares of Future Retail Ltd (FRL) on the basis of unpublished price sensitive information (UPSI) relating to demerger as such information was already in the public domain through multiple media reports.

"We are satisfied that the information relating to de-merger was already in the public domain and, therefore, trading done by the appellants in the shares after the publication of the interviews and news reports cannot be considered as trading while in possession of UPSI. Thus, the charge in the show cause notice fails and the findings given by the WTM cannot be sustained.

The impugned order is quashed," a bench comprising Presiding Officer Tarun Agarwala and Technical Member Meera Swarup said. Further, two authorities of Sebi -- WTM (Whole Time Member) as well as the Adjudicating Officer -- accepted that if the transaction is in the public domain through newspaper reports/ interviews then trading on the basis of such information cannot be treated as UPSI, the tribunal noted.

The ruling came after the entities challenged an order passed by the Securities and Exchange Board of India (Sebi) in February 2021 that had barred Kishore Biyani and certain other promoters of Future Retail Ltd from the securities market for one year for indulging in insider trading in the shares of the company. In addition, the regulator had imposed a fine of ₹1 crore each on Kishore Biyani, Anil Biyani and Future Corporate Resources.