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Informist, Friday, Jul. 31, 2026

MUMBAI – The National Stock Exchange of India Thursday said the Securities and Exchange Board of India has accepted the exchange's application under the settlement proceedings regulation for a settlement amount of INR 14.91 billion. "SEBI vide email dated July 30, 2026, has in principle agreed to accept the terms of the settlement and has made a demand of Rs.714.74 crore (INR 7.15 billion), in addition to the deposit of Rs.776.47 crore (INR 7.76 billion) made by NSE with SEBI, which will be adjusted towards the settlement amount of Rs.1,491.211 crore (INR 14.91 billion)," NSE said.

In an earnings conference call with investors in May, the exchange's management had disclosed that the exchange had on Mar. 13 "filed revised settlement terms with SEBI, for a cumulative amount of 1,491.21 crores (INR 14.91 billion), in respect of" key SEBI orders in the colocation facility and dark fibre cases.

As per the details of the regulatory and court cases disclosed in NSE's draft red herring prospectus for an initial public offering in mid-June, the exchange had filed a settlement application of INR 12.24 billion to close SEBI's pending appeal in the Supreme Court in the colocation facility case. The NSE had also filed another application for a settlement amount of about INR 2.68 billion to close SEBI's pending appeal in the Supreme Court in the colocation facility-related dark fibre case, also referred to as the lease lined connectivity case. The settlement amounts in these two applications aggregated to about INR 14.92 billion.

The main colocation case had emanated from SEBI's order of Apr. 30 2019 in which it had directed NSE to disgorge INR 6.25 billion, along with interest at 12% per annum from Apr. 1, 2014. SEBI had alleged in this order that the NSE had allowed preferential connectivity to select brokers to the tick by tick data dissemination servers in its colocation facility which resulted in these brokers making substantial profits.

The NSE had appealed against this order with the Securities Appellate Tribunal and won. The appellate body had in its ruling of Jan. 23, 2023 set aside SEBI's order. The market regulator had then appealed against the appellate body's order in the Supreme Court which was yet to give it final ruling.

In the dark fibre case, SEBI had issued an order on Apr. 30 2019 directing the NSE to disgorge INR 626 million by the exchange, along with interest at 12% per annum from Sept. 11 2015. SEBI had alleged in this order that NSE had provided preferential treatment to two brokers when it allowed them to utilise the services of an unlicensed telecom service vendor to connect their colocation racks in NSE with their colocation racks in BSE through the facility of point-to-point connectivity.

The NSE had won this case too on appeal in the Securities Appellate Tribunal. The appellate body had in its order of Aug. 9 2023 quashed the disgorgement directions of SEBI. This ruling of the appellate body had also been appealed by SEBI in the Supreme Court.

The NSE has not provided any rationale for settling these two cases which it had won on appeal. As per some market analysts, the exchange's move was driven by the push from some of its institutional shareholders to offload their shares in an IPO and the pending appeals by SEBI in the Supreme Court were seen as obstacles in getting regulatory approval for the IPO.

SEBI is expected to issue a settlement order in the matter after NSE pays the full settlement amount.  End

Reported by Rajesh Gajra

Edited by Avishek Dutta

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