SEBI issues recovery demands in DU Digital manipulation case

The Enforcement Action

The Securities and Exchange Board of India (SEBI) has issued fresh Notices of Demand in its recovery proceedings arising from the DU Digital Technologies price and volume manipulation matter. In three notices dated 2 July 2026, the regulator moved to recover dues from three named individuals under separate recovery certificates.

The notices are RC No. 9192 of 2026 against Sagarkumar Pravinchandra Dataniya (PAN BJIPD7414F), RC No. 9191 of 2026 against Dhaval Girishbhai Parmar (PAN EPZPP2397F), and RC No. 9190 of 2026 against Girish Kantilal Parmar (PAN AUDPP6127A). Each records the matter as trading activities of certain entities in the scrip of DU Digital Technologies Limited (now DU Digital Global Limited).

A Notice of Demand is a step in SEBI's recovery process. It formally calls on a defaulter to pay the amount specified in the recovery certificate, failing which the regulator may attach bank accounts, demat holdings and other assets. The three individuals are among the entities SEBI had earlier proceeded against in the same matter.

Background

The recovery certificates flow from SEBI's enforcement action in the DU Digital matter, in which the regulator examined trading in the shares of the company, then listed on the NSE SME platform. Per SEBI's order in the matter, a connected group of entities acted together to create a false and misleading appearance of trading, inflating the scrip's price and volume.

According to the order, the shares were listed at around 12 rupees in August 2021 and rose sharply to a peak near 296 rupees by late 2022, a move SEBI attributed to the manipulative trading rather than to genuine demand. The regulator's order covered conduct up to March 2023, directed disgorgement of 98.78 lakh rupees in identified gains together with interest, imposed monetary penalties, and restrained the entities involved from the securities market for periods ranging from one month to 30 months.

The current notices do not represent a fresh finding. They are recovery steps to collect the sums already crystallised against these individuals under the earlier order. SEBI has not, in these notices, made any new allegation.

What It Means

For ordinary investors, the matter is a reminder of how manipulation tends to concentrate in thinly traded SME and micro-cap counters, where a small connected group can move price and volume with relatively modest capital. A near-vertical price chart in a low-float stock, unsupported by business fundamentals, is a well-documented warning sign.

Investors can protect themselves by checking whether an adviser, broker or research service is registered with SEBI. The regulator maintains public registers of intermediaries and registered investment advisers on sebi.gov.in, and the NSE and BSE list their registered members. Tips promising guaranteed or extraordinary returns in obscure scrips deserve particular caution.

A recovery certificate and Notice of Demand also show what enforcement looks like after an order: disgorgement and penalties are pursued through attachment if they remain unpaid. Investors who believe they were affected by a manipulation matter can follow SEBI's orders and, where relevant, pursue their own remedies, but should treat named parties as facing recovery rather than as convicted of any offence.

FAQ

What exactly did SEBI order?

SEBI issued Notices of Demand dated 2 July 2026 under recovery certificates 9190, 9191 and 9192 of 2026 against three individuals, calling for payment of amounts due in the DU Digital Technologies matter. The notices are recovery steps that follow the regulator's earlier order in the same matter.

Does this mean the people named are guilty?

A Notice of Demand is a recovery action, not a criminal conviction. It seeks to collect sums determined under SEBI's order. Such orders are administrative findings that may be challenged and are subject to appeal, so being named in recovery proceedings is not the same as a court conviction.

Can the order be appealed?

Yes. SEBI's substantive orders can be appealed to the Securities Appellate Tribunal (SAT) within the prescribed period, and onward to the Supreme Court on questions of law. The recovery steps themselves follow the statutory framework SEBI applies to collect its dues.

How can I check if my broker or adviser is registered?

Use the intermediary and registered investment adviser search on sebi.gov.in, and verify broker membership on the NSE or BSE websites. Confirm the registration number and match the name exactly before parting with any money.

Where can I read the official record?

The three Notices of Demand are published in SEBI's Recovery Proceedings section on sebi.gov.in and are linked above.

This report is based on the official SEBI Notice of Demand dated 2 July 2026 and the related notices under RC Nos. 9190 and 9191 of 2026. The underlying manipulation order was surfaced via coverage in Moneylife.