sebi:Order/GG/VV-AS/2022-23/16082
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Facts / Headnote
Show Cause Notice disposed of; no penalty imposed
Provisions invoked
- s. 15J
- s. 23H
- s. 23J
- s. 23
- s. 177
- s. 188
Regulations
- Reg. 2(1)
- Reg. 21
- Reg. 23
- Reg. 18
- Reg. 18(3)
- Reg. 4(2)(f)
- Reg. 4
- Reg. 19
- Reg. 17
- Reg. 23(1)
- Reg. 2
- Reg. 20
- Reg. 23(3)
Parties
- R. C. Sinha
- Deepak Dasgupta
- H. P. Jamdar
- Arun K. Saha
Holding
The Audit Committee members of ITNL did not violate Regulation 18(3) of LODR Regulations read with Part C of Schedule II, as the word 'approval' in Point No. 8 of Para A of Part C Schedule II does not require 'prior' approval, and the members substantively complied with review/approval requirements for all quarters. The allegation of violation of Regulation 4(2)(f)(iii)(3) also fails as a consequence.
Full text
Adjudication Order in the matter of IL&FS Transportation Networks Ltd Page 2 of 21 2. The SFIO report mentioned that if the loans borrowed by ITNL, (which were routed through related parties and external parties) were borrowed by ITNL directly from IFIN, the same would have crossed the materiality threshold under Regulation 23(1) of LODR for FYs 2015-16 and 2017-18. Therefore, instead of directly borrowing funds from IFIN, ITNL borrowed loans from IFIN through eight IL&FS group companies (hereinafter referred to as “the related parties”) in the financial years 2015-16, 2016-17 and 2017-18 (hereinafter referred to as “the period of examination”) through certain related party transactions (hereinafter referred to as “RPTs”). SFIO observed that, as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “LODR Regulations”), all RPTs shall require prior approval of the audit committee. Based on the observations in the SFIO report on the RPTs of ITNL, SEBI took up the matter, for further analysis and examination on compliance by ITNL, with the provisions of the LODR Regulations.
Adjudication Order in the matter of IL&FS Transportation Networks Ltd Page 3 of 21 B. APPOINTMENT OF ADJUDICATING OFFICER
Adjudication Order in the matter of IL&FS Transportation Networks Ltd Page 4 of 21 Further, Noticee no: 2 and 3 availed of opportunity of inspection through their Authorized Representative (AR) viz. Trilegal on March 04, 2022, and Noticee no: 4 availed of the said opportunity through their AR viz. Rajani Associates on April 04, 2022.
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Source: SecMarx — sebi:Order/GG/VV-AS/2022-23/16082. 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.