The Supreme Court on Thursday sought reply from market regulator Sebi on two petitions filed by the Jaiprakash Associates top brass against the sectoral tribunal?s order that held them guilty of insider trading in the shares of the infrastructure firm.

A bench headed by justice SS Nijjar issued a notice to Sebi on two appeals filed by Harish K Vaid, the company secretary and the compliance officer and SD Nailwal, wholetime director of JAL, seeking setting aside of the tribunal?s order including penalty of R20 lakh imposed on each of them.

While the Securities Appellate Tribunal (SAT) had in October last year exonerated JAL?s executive chairman Manoj Gaur and his family from charges of insider trading, it had upheld Sebi?s order against Vaid and Nailwal over alleged violation of insider trading norms in the JAL shares under the Sebi (prohibition of insider trading) regulations, 1992.

Sebi?s order in January had made two separate charges on Vaid ? as an officer of JAL and as the so-called karta of Harish K Vaid, a Hindu Undivided Family, which was holding 2,675 shares of the company and booked a profit of R2,216 through trading.

Senior counsel PS Pathwalia, appearing for the officials, argued that keeping in view the quantum of shares purchased, the penalty imposed by the Board was excessive and the official had not derived any benefit as there was no sale of shares based on unpublished price-sensitive information (UPSI).

He further contended that ?I (Vaid) am only a company secretary and the owners have been let off as the quantum was small.? However, this did not find favour with Justice Nijjar, who observed that it was about ?what you were doing. It?s not the amount.?

SAT had also observed that although the quantum of profit booked out of the alleged trades was small, Vaid had violated the insider trading norms as he was privy to price-sensitive information.

Nailwal was involved in the consolidation of financial results of the company and the preparation of agenda for the board?s meeting to consider the proposed interim dividend and the rights issue. He had traded in the company stock by taking advantages of the UPSI, SAT said.

Sebi had alleged that the trading was done during the period when UPSI was in existence and Vaid, being an insider, was privy to it. While the quantum of trading done or the profits earned become immaterial, the fact remains that it was done when Vaid and Nailwal were in possession of UPSI, the tribunal noted, adding Vaid, being the compliance officer of the company, was supposed to act carefully as he is fully aware of the rules, his position in the company and the provisions of the code of conduct prescribed for the employees.