SEBI cracks the Religare case in record time; now, about that sanctions reasoning…
Does the Religare insider trading order reflect an improvement in SEBI's order-writing practices?
By Natasha Aggarwal and Bhavin Patel
Welcome to The Bridge! Regulatory orders shape markets, govern disputes, and test the rule of law, yet their quality rarely gets the scrutiny it deserves. The Bridge is TrustBridge’s window into the quasi-judicial work of India’s regulators: how they decide, and how they could decide better.
Woke up this morning my house was cold
Checked out the furnace she wasn’t burnin’
Went out and hoped in my old Ford
Hit the engine but she ain’t turnin’
We’ve given each other some hard lessons lately
But we ain’t learnin’
We’re the same sad story that’s a fact
One step up and two steps back
- Bruce Springsteen, One Step Up
Introduction
On May 13, 2026, a whole-time member (“WTM”) of the Securities and Exchange Board of India (the “SEBI”) issued an order (the “Order”) against Dr. Rashmi Saluja, the former Executive Chairperson of Religare Enterprises Limited (“Religare”), in which it held that Dr Saluja had traded in the shares of Religare while in possession of unpublished price sensitive information.1 It ordered that Dr Saluja disgorge an amount of INR 1.99 crore, and also imposed a penalty of INR 40 lakh.
The Burmans’ takeover of Religare was one of the more acrimonious corporate control battles in recent Indian corporate history. Conflicts raged across three regulatory battlefields, those of the SEBI, the Insurance Regulatory and Development Authority of India (the “IRDAI”), and the Reserve Bank of India (the “RBI”). Pleas were also filed in court, and Dr Saluja at one point alleged before the Delhi High Court that SEBI had “failed to discharge its responsibilities as a regulator”.2 Among various other shots fired, the Burmans accused Dr Saluja of insider trading.3 The SEBI acted upon those allegations through the proceedings that led to the present decision. The Order would appear to be the latest episode in the takeover saga that never ends.
The Order spans 87 pages and relies upon evidence such as Call Data Records and hotel invoices, and includes several WhatsApp screenshots to establish the veracity of the allegations against Dr Saluja by M.B. Finmart Private Limited, Puran Associates Private Limited, VIC Enterprises Private Limited, and Milky Investment & Trading Company (whom the order collectively refers to as the ‘Burman Group’). (Yes, Milky Investment.)
We examine the Order against the ‘Good Order Writing’ indicators (the “GOW Indicators”) developed by TrustBridge to measure the completeness and quality of adjudicatory orders issued by Indian regulators.4 While we do not examine the correctness of the Order, or second-guess the regulator’s decision, we are interested in the question of order quality as a matter of compliance with procedural rule of law requirements.
The TrustBridge working paper “Balancing Power and Accountability: An Evaluation of SEBI’s Adjudication of Insider Trading”5 (the “Insider Trading Paper”) evaluates SEBI’s orders on insider trading matters over a 15-year period and the performance of those orders in appeal before the Securities Appellate Tribunal. The paper develops an evaluation framework based on elements of the rule of law applicable to regulatory adjudication. It finds that SEBI orders often fall short of standards laid down in its own laws. The paper also indicates several areas in which SEBI’s orders do not provide clear reasoning or justification, particularly as regards the choice and quantum of sanction imposed.
The dataset for the Insider Trading Paper included orders issued until July 2023. Nearly three years later, does the Religare Order improve on the areas of weakness, or is it just one step up and two steps back?
One step up…
The Insider Trading Paper finds that, on average, it takes almost six years, from the end of the UPSI Period, for SEBI to complete its enforcement proceedings.
The table below compares the overall adjudicatory timelines for the orders in the Insider Trading Paper with the time that SEBI took in the case of the Order:
Across all three stages, the Order demonstrates substantially shorter timelines than the averages reported in the Insider Trading Paper.
What may be most relevant in the case of the Order, however, is the duration between the date that SEBI received the allegations against Dr Saluja and the date it passed the Order; information of this nature was not available to us in the case of the Insider Trading Paper, but is available in the text of the Order. SEBI received an email from the Burman Group on November 8, 2023. The Order was passed on May 16, 2026. This means that the entire proceedings, from allegation to adjudication, took a mere two-and-a-half years, around the time SEBI typically takes between issuing an SCN and passing a final order.
And two steps back
The Order perpetuates some of the deficiencies observed in the Insider Trading Paper, particularly in relation to citing precedent. The Insider Trading Paper finds that 87% of orders do not cite any previous SEBI order. The Order follows the same pattern, as it does not cite any previous SEBI order. In the absence of engagement with prior decisions, it becomes difficult to determine whether the Order reflects an established position, departs from past practice, or applies standards differently from cases involving similar facts and circumstances. Consistency in adjudicatory practices is of particular concern when decisions of such large import are taken on the basis of circumstantial evidence, and on the standard of ‘preponderance of probabilities’, as in this case.
The Order also reflects continuing weaknesses in the reasoning relating to the choice and quantum of sanctions. The Insider Trading Paper examines the use of the factors set out in Section 15J of the Securities and Exchange Board of India Act, 1992, and finds that no WTM orders identify the loss to investors, one of the factors listed in that Section. While the Order directs disgorgement and imposes a penalty, it does not identify any loss to investors.
Moreover, our evaluation of this Order against the GOW Indicators shows the Order fails to:
Explain why disgorgement and penalty were preferred over other sanctions, such as debarment;
Show the method used to calculate the penalty amount;
Demonstrate proportionality of the penalty amount with the violation.
This last is of particular concern, since the Order finds the loss averted, thereby justifying the call for disgorgement, but states clearly that it is unable to calculate the loss caused to investors. If this is the case, then two questions remain open:
Why was a penalty ordered in addition to the disgorgement?
On what basis was the penalty amount determined to be INR 40 lakhs? Why not INR 10 lakhs, the stipulated statutory minimum? Why not INR 1 crore, if the violation was egregious and an example had to be set to deter potential wrongdoers?
Conclusion
The Order demonstrates a marked improvement in enforcement timelines – SEBI acted with unusual speed by completing these proceedings in two-and-a-half years from receipt of allegations to issuance of the Order. At the same time, the Order lacks citations of precedent and sufficient reasoning on sanctions, indicating that substantive order quality on these issues has not improved since 2023.
What explains this unusually short timeline? If we are to give the regulator the benefit of the doubt, we might say that this was part of a very public controversy that was closely tracked by many observers, that the informants, the Burman Group, made SEBI’s job easier by providing all the information and evidence required to substantiate their allegations against Dr Saluja, and that therefore, the investigation department had it easy in this case.
But it is precisely because this was such a public matter that the standards of reasoning and justification expected of the regulator should be higher. Recall the series of events that lead up to this order: the alleged violator makes very public allegations against SEBI before the Delhi High Court, saying “it failed to discharge its duties”. The counterparty in the very public, very loud takeover battle royale emails allegations against Dr Saluja to SEBI, who then proceeds post haste and finds Dr Saluja has committed insider trading - taking far less time than it usually does in such instances. Such a situation requires that we shine a very bright light on SEBI’s decision-making process, particularly as regards its choice of sanctions. Unfortunately, the Order doesn’t reflect much of this light back, continuing the opaque practices of the past in not providing clear reasoning on this front.
So yes, the shorter timeline seems like one step up, but the lack of reasoning on sanction choice and quantum, especially under the circumstances that led up to this Order, pushes us two steps back.
- The authors are researchers at TrustBridge, and would like to thank Renuka Sane for her feedback.
CITATION
Natasha Aggarwal and Bhavin Patel, 2026. “SEBI cracks the Religare case in record time — now, about that sanctions reasoning…”, The Bridge, TrustBridge Rule of Law Foundation
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References
Khushboo Tiwari, ‘Religare saga: Saluja moves HC against Sebi, seeks to quash Burmans’ offer’ (Business Standard, 11 February 2025) https://www.business-standard.com/companies/start-ups/saluja-moves-delhi-hc-against-sebi-seeks-quashing-of-burmans-open-offer-125021101397_1.html
Krishna Gopalan, ‘Burmans vs Religare Board: The High-Stakes Battle for Control of the Rs 6,300-Crore Rashmi Saluja-Led Firm’ (Business Today, 25 July 2024) https://www.businesstoday.in/magazine/cover-story/story/burmans-vs-religare-board-the-high-stakes-battle-for-control-of-the-rs-6300-crore-rashmi-saluja-led-firm-438708-2024-07-25
Natasha Aggarwal and Bhavin Patel, 2026. “Stitch in time: An early evaluation of the IFSCA’s adjudicatory orders”, The Bridge, TrustBridge Rule of Law Foundation.
Natasha Aggarwal and others, 2025, “A Guide to Writing Good Regulatory Orders,” Working Paper, Trustbridge Rule of Law Foundation.
Natasha Aggarwal and others, 2025. “Balancing Power and Accountability: An Evaluation of SEBI’s Adjudication of Insider Trading,” Working Papers 13, Trustbridge Rule of Law Foundation.
SEBI final order in the matter of suspected insider trading by the Noticee in the scrip of Religare Enterprises Ltd. (13 May 2026) https://www.sebi.gov.in/enforcement/orders/may-2026/final-order-in-the-matter-of-suspected-insider-trading-by-certain-entities-in-the-scrip-of-religare-enterprises-ltd-_101405.html
Khushboo Tiwari, ‘Religare saga: Saluja moves HC against Sebi, seeks to quash Burmans’ offer’ (Business Standard, 11 February 2025) https://www.business-standard.com/companies/start-ups/saluja-moves-delhi-hc-against-sebi-seeks-quashing-of-burmans-open-offer-125021101397_1.html accessed 19 May 2026
Krishna Gopalan, ‘Burmans vs Religare Board: The High-Stakes Battle for Control of the Rs 6,300-Crore Rashmi Saluja-Led Firm’ (Business Today, 25 July 2024) https://www.businesstoday.in/magazine/cover-story/story/burmans-vs-religare-board-the-high-stakes-battle-for-control-of-the-rs-6300-crore-rashmi-saluja-led-firm-438708-2024-07-25 accessed 19 May 2026
For more details on methods, see Natasha Aggarwal and Bhavin Patel, 2026. “Stitch in time: An early evaluation of the IFSCA’s adjudicatory orders”, The Bridge, TrustBridge Rule of Law Foundation.
Natasha Aggarwal & Amol Kulkarni & Bhavin Patel & Sonam Patel & Renuka Sane, 2025. “Balancing Power and Accountability: An Evaluation of SEBIs Adjudication of Insider Trading,” Working Papers 13, Trustbridge Rule of Law Foundation.
On the issue of 'substantive order quality', pls share orders pre 2023--the period you are referring to--and the current order. It will interesting to read both the orders, and understand what has changed.