SAT Stays SEBI Ban on Unison Metals MD, Says Sharing BENPOS Data Alone Not Enough for Market Debarment

April 28, 2026 : The Securities Appellate Tribunal (SAT) has stayed the operation of a Securities and Exchange Board of India (SEBI) order debarring the Managing Director of Unison Metals Ltd. and two others from accessing the securities market, holding that such a restriction based solely on sharing BENPOS (Beneficial Ownership Position) data would be “harsh” at the interim stage.

The interim order, dated April 28, 2026, was passed by a Bench comprising Justice P.S. Dinesh Kumar (Presiding Officer), Meera Swarup (Technical Member), and Dr. Dheeraj Bhatnagar (Technical Member).

The appeal arose from SEBI’s order dated February 5, 2026, by its Whole Time Member, which had debarred the appellants for one year and imposed a penalty of ₹10 lakh each in connection with an alleged “pump and dump” scheme involving shares of Unison Metals Ltd.

The appellants—Tirth Uttamchand Mehta (Managing Director), a promoter, and a related party—were accused of aiding the scheme by sharing BENPOS data with intermediaries who allegedly used it to facilitate stock recommendations on Telegram channels, resulting in artificial inflation of trading volumes and prices.

Before SAT, the appellants argued that they neither traded in the scrip nor derived any unlawful gains. They contended that BENPOS data merely reflects weekly shareholding positions and does not include transaction prices or trade details. Importantly, they emphasized that such data is publicly accessible under Section 94 of the Companies Act, 2013.

The Tribunal noted that SEBI’s case against the appellants was limited. “The solitary allegation against the appellants is that they have shared the BENPOS,” the Bench recorded.

Referring to the statutory framework, SAT observed that BENPOS is not unpublished price-sensitive information and can be obtained by “any person.” In the absence of any allegation of trading or direct gain, the Tribunal held that imposing a market ban solely on the basis of sharing such data would be disproportionate at the interim stage.

The Bench further took into account the broader consequences of the debarment. It noted that under SEBI (ICDR) Regulations, a company cannot make a public offer if its promoter or director is barred from the securities market. The debarment of the Managing Director had already begun affecting the company’s financial position, including withdrawal of credit facilities by lenders, as reflected in material placed on record.

Considering the balance of convenience and potential impact on investors, SAT held that interim protection was warranted. It observed that deferring the consequences of the SEBI order would be in the interest of investors pending final adjudication.

Accordingly, the Tribunal stayed the operation of SEBI’s order against the appellants, subject to deposit of 50% of the penalty amount within two weeks. SEBI was granted liberty to seek an early hearing after completion of pleadings.

Case Details:
Case Title: Tirth Uttamchand Mehta & Ors. v. Securities and Exchange Board of India
Case No.: Appeal No. 86 of 2026 (with Misc. Application No. 282 of 2026)