SAT Quashes SEBI Penalties On Nusli Wadia, Jehangir Wadia & Ness Wadia

The Securities Appellate Tribunal (SAT) has set aside the Securities and Exchange Board of India’s (SEBI) order barring Bombay Dyeing & Manufacturing Co. and its promoters, Nusli Wadia, Ness Wadia, and Jehangir Wadia, from the securities market for two years.

The tribunal also nullified SEBI’s direction preventing the Wadias from holding directorships or key managerial positions for one year. SEBI had imposed penalties of Rs 2.25 crore on Bombay Dyeing, Rs 4 crore on Nusli Wadia, Rs 5 crore on Jehangir Wadia, and Rs 2 crore on Ness Wadia. SAT directed SEBI to refund the penalties within four weeks and noted the inordinate delay of nearly nine years in addressing the alleged violations, which relate to financial statements for FY2011-12. The tribunal also lifted restrictions on other entities and executives linked to the Wadia Group, including Scal Services and its Directors. SAT highlighted SEBI’s delayed action in issuing show-cause notices in June 2021 and passing its order in October 2022.