sebi:BS/AO-61/2008

SEBI · SEBI · 2007-09-28 · Biju S, Adjudicating Officer

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Adjudication proceedings disposed of; no penalty imposed

Provisions invoked

• s. 4A
• s. 23
• s. 2(41)
• s. 617
• s. 23(1)

Parties

• Oil and Natural Gas Corporation Limited (ONGC)

Holding

The adjudication proceedings against ONGC for failure to appoint the requisite number of independent directors under Clause 49 I(A) of the Listing Agreement for the quarters ended March 2006 to March 2007 were disposed of without imposing any penalty.

Full text

2 requirements of Clause 49 1 (A) of listing agreement with regard to the appointment of requisite number of independent directors on the Board of the noticee in respect of the quarters ended March 2006, June 2006, September 2006, December 2006 and March 2007. In view of the alleged failure on the part of the noticee to comply with the provisions of Clause 49 1(A) of the listing agreement, adjudication proceedings were initiated in terms of provisions of Section 23 I of the SCRA. NOTICE AND REPLY

3 7. The noticee is alleged to have violated Clause 49 1(A) of the listing agreement with the Stock Exchanges in respect of the appointment of requisite number of independent directors in the Board of Directors of the noticee. The text of the said clause states the following -

4 d. is not a partner or an executive or was not partner or an executive during the preceding three years, of any of the following: (i) the statutory audit firm or the internal audit firm that is associated with the company, and (ii) the legal firm(s) and consulting firm(s) that have a material association with the company. e. is not a material supplier, service provider or customer or a lessor or lessee of the company, which may affect independence of the director; and f. is not a substantial shareholder of the company i.e. owning two per cent or more of the block of voting shares.

Source: SecMarx — sebi:BS/AO-61/2008. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.