Authority: High Court of Judicature at Madras

Order Date: 02.11.2026

Case Overview

  • Parties: Petitioner S. Thangappalam (second accused) vs. Securities and Exchange Board of India (SEBI) (respondent). Counsel for petitioner: Mr. Ramaswamy Meyyappan; counsel for respondent: Mr. ARL Sundararajan, Additional Solicitor General, assisted by Mr. C. Prasanna Venkatesh.
  • Case: Criminal Original Petition (CRL.O.P. No.30694 of 2026) seeking regular bail under Section 483 of the BNSS in C.C. No.1 of 2022, a Special Court proceeding under the SEBI Act, 1992. Offences alleged under Sections 24(1), 24(2) and 27 of the SEBI Act, punishable by up to ten years’ imprisonment and fine up to Rs 25 crore.
  • Background: The petitioner was Managing Director of AsurreAgrowtech Limited, which mobilised approximately Rs 69.30 crore from the public through schemes later held by the SEBI Whole‑Time Member (order dated 09.05.2016) to be unregistered collective investment schemes. SEBI directed the company and its directors to wind up the schemes, refund monies with returns, and submit a winding‑up report. The appeal before the Securities Appellate Tribunal was disposed on 06.04.2018. Refund directions remain unfulfilled, giving rise to the charge under Section 24(2). A Recovery Certificate No. 1725 of 2018 was issued on 10.09.2018; notice of demand received on 12.09.2018. Between 07.12.2018 and 01.02.2019 the company, through the petitioner, executed nine sale deeds of land at Kottachedu Village, Yercaud, which SEBI later declared void (orders dated 28.05.2021 and 26.07.2021). This constitutes the charge under Section 24(1).
  • Procedural History: Complaint taken on 03.01.2022. Summons to petitioner returned as he had left his known residence; summons to third accused on 10.02.2022 unanswered. Non‑bailable warrant issued on 24.02.2023. Petitioner presented before the Economic Offences Wing, Salem on 01.10.2026 after reporting condition of bail in a related TNPID prosecution and has been in custody for one month. Trial has not commenced; the case remained at the stage of service of process.
  • Petitioner’s Submissions: No restriction on bail under SEBI Act; evidence is documentary; no summons served; petitioner not an absconder; health condition (mild concentric left ventricular hypertrophy, Grade I diastolic dysfunction, elevated BP) requires regular specialist care; affidavit of undertaking dated 28.10.2026 to submit a settlement scheme for verified claimants within twelve weeks of release.
  • Respondent’s Submissions: Petitioner’s residence claim inconsistent; multiple pending criminal cases not disclosed; repayment figures (Rs 11.74 crore, auditor’s certificate Rs 1,71,00,717, claim of Rs 54 crore settled) not reconcilable; outstanding dues per SEBI letter dated 23.09.2025 amount to Rs 147,52,14,445, of which Rs 78,27,16,091.90 is interest; medical condition not severe; bail not opposed for recovery but for petitioner’s conduct and credibility.

Final Outcome

  • The Court dismisses the Criminal Original Petition, denying regular bail to the petitioner.
  • Directions: The Principal Sessions Judge, Chennai (Designated Special Court under the SEBI Act) shall furnish required copies within two weeks, proceed without adjournments, and endeavour to conclude the trial within three months. The Superintendent of the prison shall ensure the petitioner’s presence at every hearing, either physically or via video conferencing.

Topics: Bail, Securities Regulation