SEBI settlement overhaul may offer exit for cases stuck in SAT, courts
Lawyers expect easier appellate-stage settlements, lower settlement premiums and simpler calculations could reduce litigation and speed up resolution
The Securities and Exchange Board of India (SEBI) is planning to overhaul its settlement framework, which could provide a pathway to resolve cases stuck in the Securities Appellate Tribunal (SAT) or the Supreme Court. This move aims to tackle the backlog of unresolved disputes and enable more timely settlements. The regulator proposes to lift the existing 60-day limitation on settlement attempts, allowing for continued discussions even after cases have reached higher courts.
This reform is backed by experts who argue that settlement becomes more viable as cases progress and evidence is examined. The overhaul also includes faster resolution processes for smaller cases and reduced charges for multiple proceedings. However, critics point out that settlement would still require consent, regulatory approval, and consideration of investor interests, particularly in cases involving fraud, systemic harm, or unresolved legal questions.
SEBI currently has 1,066 appeals pending before SAT and 539 cases before the Supreme Court, along with 620 recovery matters involving recovery certificates tied up in various courts. The regulator collected ₹109.8 crore in settlement charges and ₹11.3 crore in disgorgement during fiscal year 2026.
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