India market issues notices to PTC India financial arm citing governance lapses

Ptc India Financial Services

09/05/2023 15:10

By Sarita Chaganti Singh and Jayshree  P Upadhyay
       NEW DELHI/ MUMBAI, May 9 (Reuters) - India's market
regulator has issued legal notices to government owned PTC India
 PTCI.NS  and its financial services unit PTC India Financial
Services (PFS)  PTCN.NS , demanding explanations of alleged
corporate governance lapses, two people familiar with the matter
said.
    PTC India, a power trading company, and PTC India Financial
Services, a finance company, have been given 21 days to reply to
the show cause notice that requires them to explain before the
market regulator why action should not be taken against them,
the sources said. 
    Speaking on condition of anonymity as they are not allowed
to speak to the media, they said Investigations by Securities
and Exchange Board of India (SEBI) had found preliminary
evidence of alleged violations of governance and listing norms.
    Officials in PTC India and PFS did not immediately respond
to messages and emailed queries sent by Reuters seeking
comments. SEBI did not respond to an email sent by Reuters.
    The SEBI investigation followed allegations levelled by
three independent directors of PTC India Financial Services in
January 2022. 
    The three directors resigned from the board citing
"instances of serious lapses in corporate governance and that
the company failed to act on concerns raised by them" in a
letter available via stock exchange disclosures.
    Following the company's response to the show cause notice,
SEBI will pass a final order, with possible consequences ranging
from monetary penalties to a ban from capital markets.

 (Reporting by Sarita Chaganti Singh and Jayshree P Upadhyay;
editing by Barbara Lewis)
 ((Sarita.ChagantiSingh@thomsonreuters.com;))