Securities and Exchange Board of India (SEBI) Chief Madhabi Puri Buch and her husband Dhaval Buch, in a fresh statement, responded to a slew of allegations by Hindenburg against them in recent weeks, and said that the accusations are false, malicious and defamatory. The SEBI Chief said that she adhered to all disclosure and recusal guidelines set by the markets regulator and in fact, maintained a proactive continuing recusal list with SEBI over and above the requirements under the guidelines.
“In keeping with the highest standards of governance, Madhabi has never dealt with any file involving Agora Advisory, Agora Partners, the Mahindra Group, Pidilite, Dr Reddy’s, Alvarez and Marsal, Sembcorp, Visu Leasing or ICICI Bank at any stage after her joining SEBI,” the statement released on Sep 13 said.
“Over and above all of the aforesaid, right from 2017, when Madhabi joined SEBI as a Whole Time Member, she had disclosed the fact of her shareholding in Agora Advisory as well as in Agora Partners,” it added.
Earlier, Hindenburg Research and opposition political parties had criticised Madhabi Buch over alleged conflicts of interest in investigations involving Adani Group and other corporations. The allegations were also of conflict of interest with the Mahindra Group and Dr Reddy’s due to consulting fees given by these groups to Dhaval Buch.
“It is unfortunate that questions have been raised regarding the consulting assignments of Dhaval Buch and the firms Agora Advisory in India and Agora Partners in Singapore. There seems to be an assumption that when a spouse of a senior government official is appointed as an advisor, it must be attributed to factors beyond professional merit. Such assumptions overlook the strength of qualifications and expertise and reach conclusions that are most unfortunate,” the statement said.
Madhabi Buch and Dhaval Buch provided extensive details to reject the claims, along with statements issued by the respective companies like Mahindra Group, Pidilite, Dr Reddy’s, among others. Three out of the five approvals or orders of SEBI, the statement said, do not pertain to the company or any of its subsidiaries. One was a fast-track rights issue, which did not require any approval from SEBI. One was an order issued in March 2018, well before Dhaval Buch started working with the Mahindra Group.
“Despite the transparency and professional clarity given by these organizations, it is unfortunate that the need to justify decisions taken by such respected companies, based purely on Dhaval’s expertise, has to be undertaken by them and by us,” the couple said in the statement.
On allegations of rental income received from a property owned by Madhabi and Dhaval Buch, the statement said, “The property was leased out in the normal course. As it turned out subsequently, the lessee happened to be an associate of Wockhardt, a listed company which had come under investigation. Madhabi has not dealt with any files related to Wockhardt.”
“In this context, even an allegation of conflict is not only defamatory, false and vexatious, but is clearly malicious and motivated,” it said.
In regards to Madhabi Buch’s ICICI Bank Employee Stock Options (ESOPs), she said, “With respect to the baseless allegations regarding holding ESOPs while serving at SEBI, it is to be noted that SEBI’s guidelines permit board members, including the Chairperson, to hold and transact in ESOPs. Requisite disclosures and recusals are to be made.”
In conclusion, while maintaining that the accusations were false, the statement said that the allegations themselves are based on their Income Tax Returns. “All these matters are a part of our income tax returns in which all these matters have been fully disclosed and taxes have been duly paid. Shockingly, our income tax returns clearly have been obtained by adopting fraudulent means and illegally. This is a clear breach of not only our right to privacy (which is a fundamental right) but also a violation of the Income Tax Act. The facts, transparently reflected in our income tax returns, have been twisted deliberately to create a false narrative,” it said.
Madhabi and Dhaval Buch said, “The fact that so far, allegations are being made with new falsehoods each time, in installments, makes it clear that the only intention is to keep distorting facts, to keep making false allegations again and again to build a false narrative. Clearly, arriving at the truth is not the objective.”