PTC India Financial Services’ director Rajib Kumar Mishra, who is also the CMD of PTC India, and PTC India Financial Services’ former MD and CEO Pawan Singh have been fined Rs 10 lakh and Rs 25 lakh respectively by the market regulatory, Securities and Exchange Board of India (SEBI) following its investigation into corporate governance lapses. SEBI, on Wednesday, released its order in the case.
PTC India Financial Services has been under regulatory scanner for over two years now, since three of its independent directors resigned from the company board raising concerns over corporate governance issues. Pawan Singh had earlier stepped down after being forced to go on leave following a Reserve Bank of India directive on June 20, 2023. While the company had not disclosed the contents of the RBI letter, sources had said that the central bank has directed the company to replace the current MD and CEO. Later, PTC Financial in a communication to the exchanges, said, “We would like to inform that pursuant to the direction of the RBI, the board in its meeting held on June 20 decided that Lodha will take over the functions and responsibilities of the MD & CEO till the regular MD & CEO is appointed. The position of MD and CEO has not been filled for almost nine months now.
The order, issued by the SEBI on June 12, said that Pawan Singh had “grossly misused” his position as MD and CEO of PFS and that Rajib Kumar Mishra had been “acting as a willing accomplice”.
“The MD & CEO in a company, though sitting at a high position within the management hierarchy, is duty-bound to follow the decisions of the Board of his company and cannot exercise his power unilaterally in an unfettered manner. However, in this case, the MD & CEO employed all the tricks to defeat the decision of PFS Board to appoint Mr. Ratnesh, thereby keeping a critical vacancy in the Company unfilled,” the order stated.
Besides slapping a penalty, Sebi has also restrained Pawan Singh and Rajib Kumar Mishra from holding any Board or key managerial personnel position in any listed company or any registered intermediary or associating themselves with any listed entity which intends to raise money from the public.