MUMBAI: The Securities Appellate Tribunal (SAT) has granted ad-interim relief to Avadhut Sathe and his trading academy, allowing them to resume operations after the Securities and Exchange Board of India (Sebi) barred them from the stock market earlier this month.
On Friday, a SAT bench presided over by Justice P.S. Dinesh Kumar heard an appeal filed by Avadhut Sathe Trading Academy (ASTA), Avadhut Sathe, and his wife, Gouri Sathe. The appeal argued that there was no urgency warranting such drastic intervention by Sebi.
Ex-parte interim orders, the appellants said, are meant for situations of extreme urgency where immediate harm to investors is imminent—conditions they argued were entirely absent in this case. The freezing of bank accounts, prohibition on market access, and the demand for a large deposit, all without a hearing, were described as violations of principles of natural justice and proportionality.
The appellant’s lawyer, senior counsel Janak Dwarkadas, said that the regulator had effectively “passed a sentence without a trial” by invoking its ex-parte powers without granting the appellants any opportunity to be heard, according to a press note shared by ASTA.
An ad-interim order is a temporary order granted immediately to prevent urgent, irreparable harm or to maintain the status quo until a full hearing can take place.
In a 125-page ex-parte interim order passed on 4 December, Sebi had barred Sathe and his institute from dealing in securities and ordered the impounding of ₹546.16 crore for allegedly running unregistered investment advisory and research analyst services under the guise of stock-market education. The market watchdog also ordered the freezing of their bank and demat accounts and directed the creation of fixed deposits for the alleged illegal gains.
The regulator alleged that the academy had collected an “astronomical” ₹601.37 crore from more than 337,000 investors since 2015. The appellants argued that this figure represented cumulative tuition fees collected over several years across multiple courses with varying price points, and not money received for investment or advisory purposes.
ASTA also said Sebi’s case was based on 12 complaints out of the total number of students. Acting on such a small number of complaints, they said, amounted to a “vindictive, high-handed and disproportionate exercise of power,” according to the appeal.
The appellants also contended that there is a “regulatory vacuum” due to two Sebi circulars that contradict each other. In a 2024 circular, the regulator said market price data can be shared for educational purposes with a one-day lag. In 2025, Sebi said market price data of the preceding three months cannot be used for educational purposes.
The appellants also cited Sebi chairman Tuhin Kanta Pandey as having acknowledged this vacuum at a recent public event.
They argued that Sebi failed to identify any instance of personalized, client-specific investment advice. The material relied upon, they said, consisted of batch-based educational interactions, illustrative discussions and explanations, which are excluded from the definition of “investment advice”. Even the few instances cited by Sebi, spread over several years, did not amount to carrying on the business of investment advisory or research services, the plea said.
In its 4 December order, the regulator had cited instances where the trading profits and losses of ASTA students were allegedly misrepresented by the academy during sessions and on its website. The appeal disputes these allegations, describing Sebi’s presentation of information as inaccurate. It provides images of the profit-and-loss statements of various students with profitable trading accounts, in contrast to what the regulator alleged.
ASTA also has disclosures on its website stating that it is a financial market training institute and is not engaged in the business of providing investment advice, according to the appeal.
The tribunal appeared to share some of these concerns.
“We are also surprised that prima facie Sebi wants a deposit of ₹546 crore after shutting down everything,” the bench remarked, according to the note shared by ASTA. The matter has been posted for further hearing on 9 January 2026.
