SAT reduces Arun Panchariya's 67 crore penalty in GDR fraud case

This final order re-examines the quantum of the penalty imposed on Arun Panchariya for his role in the fraudulent Global Depository Receipt (GDR) issue by Winsome Textile Industries Ltd, following a remand by the Securities Appellate Tribunal (SAT).

Who it concerns: Arun Panchariya (Noticee), Winsome Textile Industries Ltd (Company), and its directors.

What SEBI found or ordered

• SEBI originally imposed a penalty of INR 67,00,00,000 (67 Crore) on Arun Panchariya in December 2021.
• The SAT allowed the appeal in October 2025, setting aside the disgorgement and the 67 Crore penalty, and remanded the matter to SEBI to re-examine the penalty quantum.
• SEBI found that Arun Panchariya was involved in the first stage of the fraud (subscription of GDRs using loan proceeds secured by GDR proceeds) but not the second stage (conversion and sale to Indian investors).
• The GDR issue amount involved was USD 9.99 million (approx. INR 44 Crore).
• SEBI noted that the Noticee was involved in multiple fraudulent GDR issues and that his modus operandi was affirmed by the Supreme Court.
• SEBI considered the proportionality of the penalty, noting that SAT had reduced penalties for the Company and a director in related appeals.

Also in the document

• The SAT explicitly stated that the original 67 Crore penalty was not justified given that SEBI had imposed a penalty of only INR 20 Lakh in other cases with GDR amounts more than double the size of this case.
• The order highlights a cross-border element involving EURAM Bank and foreign investors (FIIs) in the fraudulent scheme.
• The SAT found that the Noticee received GDRs worth USD 9.018 million without payment of consideration as a result of the fraud.