PTC India Financial's Former CEO And Chairman Asked To Return Nearly Rs 50 Lakh
The decision to recover the dues was taken after the board received legal opinion affirming the same.
PTC India Financial Services Ltd. has decided to call back Rs 49.7 lakh, paid for legal fees to its former managing director, chief executive officer and non-executive Chairman.
While announcing the company's fourth quarter results late Thursday, the company said that its board of directors had decided to recover Rs 10.94 lakh, paid as legal fees for former Chairman Rajib Mishra and Rs 38.76 lakh crore paid as legal fees for its former MD and CEO Pawan Singh. The amount includes the Goods and Services Tax paid over the legal fees.
PTC India Financial had paid the said bills after both Mishra and Singh received show cause notices from Securities and Exchange Board of India in May 2023, over corporate governance concerns at the company.
The decision to pay for these dues were in line with Articles of Association of the company and the board of directors on May 18, 2023 decided to indemnify both the MD and CEO and former Chairman against all charges, including financial liabilities, taken on by them in the service of the company.
Later, in December, the management presented the board with a proposal to clear legal fees worth Rs 25 lakh per annum for both directors.
"While discussing the issue, board desired to take a legal opinion from a law firm whether the legal expenditure on such cases can be paid, particularly when the concerned officials have stated that such notices have been received by them in their individual capacity," the notes to accounts say.
The decision to recover the dues was taken after the board received legal opinion affirming the same. Thus, Rs 49.7 lakh was recoverable from both directors as of March. Mishra has paid back the Rs 10.94 lakh owed by him, PTC India Financial said in its results notification to the exchanges.
Singh, who was sent on administrative leave in June 2023 following notices from SEBI and the Reserve Bank of India, has been relieved of his services, effective Oct. 2, 2023, the board said.
The fourth quarter results, which were set to be approved at a board meeting on May 20, have seen inordinate delays, as the board has been adjourning the meetings. Finally, on Thursday, the board met between 8:30 p.m. and 11:40 p.m. to approve the results.
In their notes, the statutory auditors Lodha & Co. said that the meetings have been repeatedly adjourned as:
There were corporate governance issues related with conducting few meetings, with shorter notice and delay in signing and finalisation of the few minutes of audit committee and board meeting.
Quality, quantity and timelines of flow of information between the company and to the board members was ineffective and inadequate to perform duties and needs improvement for compliances of directions of the board and various sub-committees, respectively.
