TRANSPARENCY ISSUES IN BOARD EVALUATION PRACTICES IN COFORGE LIMITED

 TRANSPARENCY ISSUES IN BOARD EVALUATION PRACTICES IN COFORGE LIMITED

Coforge’s internal audit flagged serious governance lapses: former Chairman O.P. Bhatt received the lowest rating in the board evaluation, but this was withheld from the Nomination & Remuneration Committee (NRC) and the board.

The controversy led to Bhatt’s resignation on September 8, 2026, and has raised questions about transparency in board evaluation practices.

AUDIT FINDINGS (KPMG, Q2 FY26):

·       Detailed board evaluation reports were not circulated to all directors.

·       The lowest rating for the Chairman was omitted from discussions.

NO IMPACT ON FINANCIAL REPORTING

Coforge emphasized that the issue relates to governance evaluation, not financial reporting.

No impact on financial statements, revenue, or profitability.

GOVERNANCE TRANSPARENCY ISSUES 

The audit flagged non-disclosure of a low rating for the Chairman, leading to Bhatt’s resignation. While Coforge insists this has no financial impact, the episode highlights serious governance transparency issues that could draw regulatory and investor scrutiny.

# Your Compliance expert R V SECKAR, FCS, LLB 79047 19295,

₹890.52 CR TAX + EQUAL PENALTY UNDER SECTION 74 CGST ACT ON TATA STEELS LTD WAS STRUCK DOWN BY SUPREME COURT

 ₹890.52 CR TAX + EQUAL PENALTY UNDER

 SECTION 74 CGST ACT ON TATA STEELS

 LTD WAS STRUCK DOWN BY SUPREME

 COURT

                TATA STEEL LTD. V. UNION OF INDIA

Tata Steel faced ₹890.52 Cr tax + equal penalty under Section 74 CGST Act.

The Supreme Court in Tata Steel Ltd. v. Union of India (2026) held that a Show Cause Notice (SCN) under Section 74 of the CGST Act cannot merely use labels like “fraud” or “suppression” without laying out the foundational facts.

The ₹890.52 crore tax demand plus equal penalty was struck down because the SCN was based only on audit objections, not on the independent satisfaction of the assessing officer.

The Supreme Court has made it clear—Section 74 is not a routine extension tool. Authorities must prove fraud or suppression with facts in the SCN itself. For corporates, this ruling is a strong defense against vague, audit-driven GST demands.

# Your Compliance expert R V SECKAR, FCS, LLB 79047 19295,

WHETER TATA GROUP WILL BE ACQUIRED BY INDIAN BUSINESS CONGLOMERATES IF IT GO FOR A MANDATORY PUBLIC LISTING AS DIRECTED BY RBI?

 WHETER TATA GROUP WILL BE ACQUIRED BY INDIAN BUSINESS CONGLOMERATES IF IT GO FOR A MANDATORY PUBLIC LISTING AS DIRECTED BY RBI?

MANDATORY PUBLIC LISTING

The Reserve Bank of India (RBI) has rejected Tata Sons’ bid to remain private, forcing the ₹2.01 lakh crore holding company of the Tata Group to go for a mandatory public listing.

RIVAL CONGLOMERATES MAY ACQUIRE A STAKE IN TATA GROUP

This marks a historic regulatory intervention that could reshape ownership dynamics and even open the door for rival conglomerates to acquire a stake in TATA Group.

MANDATORY LISTING FOR UPPER LAYER NBFC

Tata Sons remains classified as an Upper Layer NBFC, which requires public listing under RBI’s scale-based framework. Its assets of ₹2.01 lakh crore (as of March 2026) are well above the ₹1 lakh crore threshold.

LEADERSHIP TURBULENCE:

Chairman N. Chandrasekaran announced that he will not seek reappointment after Feb 2027, intensifying uncertainty. Noel Tata has opposed listing, while Shapoorji Pallonji (SP) Group supports it to dilute stake and reduce  debt.

ACQUISITION POSSIBILITY

A public listing makes Tata Sons’ shares tradable, potentially allowing large Indian conglomerates (Reliance, Adani, Birla, etc.) to acquire stakes.

VETO POWER

·       Tata Trusts’ majority holding gives them veto power.

·       Any hostile takeover attempt would face legal, cultural, and political resistance, given Tata’s national importance.

RISKS & CHALLENGES

GOVERNANCE CRISIS:

Listing amid leadership transition could weaken Tata Trusts’ grip.

MARKET VOLATILITY:

IPO of such scale may disrupt Indian equity markets temporarily.

REGULATORY OVERSIGHT:

As an NBFC-UL, Tata Sons will face stricter compliance for at least five years.

CONGLOMERATE	FINANCIAL CAPACITY	STRATEGIC FIT WITH TATA SONS	CHALLENGES
Reliance Industries (Mukesh Ambani)	Market cap ~₹19 lakh crore; strong cash flows from Jio & retail	Synergies in telecom, retail, energy; global ambitions align with Tata’s footprint	Cultural clash with Tata’s conservative governance; regulatory scrutiny
Adani Group (Gautam Adani)	Market cap ~₹12 lakh crore; aggressive expansion in infra, energy	Could leverage Tata’s brand credibility to balance reputation; infra + power synergies	Debt-heavy balance sheet; political sensitivities; Tata Trusts resistance
Aditya Birla Group	Market cap ~₹3.5 lakh crore; diversified across cement, metals, telecom	Long-standing peer of Tata; natural overlap in metals, financial services	Smaller scale vs Reliance/Adani; may need consortium approach
Mahindra Group	Market cap ~₹2 lakh crore; strong in autos, IT, agri	Cultural alignment with Tata values; IT + auto synergies	Limited financial muscle for hostile stake; would need alliances
Global Investors (Temasek, GIC, sovereign funds)	Deep pockets; long-term institutional investors	Could enter via SP Group stake; neutral governance stance	Lack of Indian industrial base; may face nationalist pushback

KEY TAKEOVER

RBI’s move forces Tata Sons into the public market, ending decades of private control. While Tata Trusts will fight to retain dominance, the Shapoorji Pallonji [SP] Group’s openness to dilution means rival conglomerates could finally gain a foothold in India’s most iconic business empire.

## Your Compliance expert R V SECKAR, FCS, LLB 79047 19295

RBI'S NEW FOREIGN EXCHANGE MANAGEMENT (EXPORT AND IMPORT OF GOODS AND SERVICES) REGULATIONS, 2026 COME INTO FORCE FROM OCTOBER 1, 2026, — REPLACING THE 2015 FRAMEWORK

 RBI'S NEW FOREIGN EXCHANGE MANAGEMENT (EXPORT AND IMPORT OF GOODS AND SERVICES) REGULATIONS, 2026 COME INTO FORCE FROM OCTOBER 1, 2026, — REPLACING THE 2015 FRAMEWORK

 

1)      Export realization period extends from 9 months to 15 months

 

2)       SOFTEX filing is being phased out.

 

3)      Every pending EDPMS entry needs to be reconciled before October 1.

 

4)      Exporters must file an Export Declaration Form (EDF) at the time of export

 

5)      For EDI ports, EDF submission is deemed part of the shipping bill.

 

Exporters and importers should update compliance processes before October 1, 2026, train staff on new EDF timelines, and coordinate with Authorized Dealers for smooth transition.

# Your Compliance expert R V SECKAR, FCS, LLB 79047 19295,

AVATAR STEELS ENVIOUS’ TRACK RECORD ON NON COMPLIANCE & NO GOVERNANCE

A VATAR STEELS ENVIOUS’ TRACK

 RECORD,ON NON COMPLIANCE & NO

 GOVERNANCE

BEWARE OF IPO’s WITH GOVERNANCE FAILURES FOR THE LAST

9 YEARS

AVATAR STEELS ran for NINE years without an audit committee.

It paid a penalty to the Registrar of Companies on August 7, 2026. And filed its IPO papers (DRHP) on August 14, 2026. Seven days later.

·       NO AUDIT COMMITTEE

·       NO INDEPENDENT DIRECTOR

·       NO WOMEN DIRECTOR

·       NO DIVIDEND POLICY

·       NEW COMPANY SECRETARY & CFO

·       INDEPENDENT DIRECTOR RESIGNED ON THE DATE OF VOTING ON IPO

WILL THE SEBI LOOK INTO THESE COMPANIES DRHP FILINGS?

R V SECKAR, FCS, LLB

COMPANY AND DIRECTORS WERE FINED ₹4,50,000 FOR FILING FINANCIAL STATEMENTS WITHOUT COMPANY SECRETARY SIGNATURE AS SHE MET WITH A LIFE-THREATENING ACCIDENT

 COMPANY AND DIRECTORS WERE FINED ₹4,50,000 FOR FILING FINANCIAL STATEMENTS WITHOUT COMPANY SECRETARY SIGNATURE  AS SHE MET WITH A LIFE-THREATENING ACCIDENT

ROC DELHI VS NATIONAL SCHEDULED CASTES FINANCE AND DEVELOPMENT CORPORATION

FACTS OF THE CASE

·       The company and its directors were fined ₹4,50,000 for filing financial statements without the signature of the Company Secretary.

·       The lapse occurred because the CS had met with a life‑threatening accident and was unable to sign.

LEGAL BASIS

Section 134(1) of the Companies Act, 2013 mandates that financial statements must be signed by:

·       The Chairperson (if authorized), or

·       At least two directors, one of whom must be the MD (if any), and

·       The Company Secretary, wherever appointed.

Filing without the CS signature, when a CS is appointed, is treated as non‑compliance, regardless of the reason.

                  WHAT COMPANY SHOUD HAVE DONE?

Even though the accident was genuine and unfortunate, the ROC held that the company should have taken steps such as:

·       Appointing an interim or acting Company Secretary, or

·       Seeking condonation of delay from the MCA before filing.

KEY TAKEAWAYS

The ROC Delhi order shows that personal emergencies do not excuse statutory lapses. The company and directors were penalized because the law requires strict adherence to signature requirements, and no exemption exists for accidents or incapacity.

This case is a striking example of how statutory compliance requirements under the Companies Act, 2013 are enforced rigidly, even when there are extraordinary personal circumstances.

 

# Your Compliance expert R V SECKAR , FCS ,  LLB 79047  19295,

CAN A COMPANY HOLD A BOARD OR AGM MEETING ON A SUNDAY ?

 CAN A COMPANY HOLD A  BOARD  OR AGM MEETING ON A SUNDAY ?

Under Companies Act, 2013, a company can hold board meeting on any day, including Sundays and public holidays, unless the company’s Articles of Association (AoA) impose restrictions.

Under Section 96, an AGM is required to be held during business hours, on a day that is not a National Holiday, at the registered office or another place within the same city, town or village, subject to the applicable provisions/

Holding an AGM on a Sunday which is not a national holiday does not automatically make a meeting invalid.

Hence , there is no bar for the company to hold a board meeting or AGM on Sunday.