ROC DELHI PENALISED ₹ 6,00,000 ON INTEGRIS MEDTECH LIMITED ,ITS PAST AND PRESENT CS , PAST AND PRESENT CFO , EXECUTIVE DIRECTOR AND CEO FOR ISSUE OF ESOP WITHOUT OBTAINING SEPARATE SHAREHOLDER APPROVALS BY WAY OF SPECIAL RESOLUTION .

 ROC DELHI PENALISED ₹ 6,00,000 ON INTEGRIS MEDTECH LIMITED ,ITS PAST AND PRESENT CS , PAST AND PRESENT CFO , EXECUTIVE DIRECTOR AND CEO FOR ISSUE OF ESOP WITHOUT OBTAINING SEPARATE SHAREHOLDER APPROVALS BY WAY OF SPECIAL RESOLUTION . 

FACTS

The company issued shares under an Employee Stock Option Plan (ESOP).

The issuance was found to be non‑compliant with Section 62(1)(b) of the Companies Act, 2013, which governs ESOP allotments.

Both the ex‑Company Secretary and the present Company Secretary were penalized ₹50,000 each.

NOMINATION AND REMUNERATION COMMITTEE (NRC),

At its meetings held on May 22, 2024, and July 14, 2025, approved granting of ''Stock Options'' to employees of the Subsidiary Companies, without obtaining separate shareholder approvals by way of (SR) Special Resolution.

APPROVED GRANTING OF "STOCK OPTIONS"

➡️Further, NRC at its meetings held on May 22, 2024, and February 21, 2025 in FY 2024-25 approved granting of "Stock Options" to employees exceeding 1% of the Issued Share Capital of the Company, without obtaining Separate Shareholder approvals by way of SR. 

PASSING OF SPECIAL RESOLUTION

➡️Later, the Company Passed Special Resolution at EGM held on August 26, 2025, for the extension of benefits under the ESOP Scheme to the employees of Subsidiary Companies and Ratification of Previous Grants made to them.

RATIFICATION OF PREVIOUS GRANTS OF ESOP IN EGM

➡️Further, at EGM held on March 5, 2026, Company passed another Special Resolution for Ratification of Previous Grants of ESOP exceeding 1% of the Issued Share Capital of the Company made to identify employees of the Company and its subsidiary companies under the ESOP Scheme.

ROC IMPOSED PENALTY

The ROC held that:

The ESOP allotment violated Section 62(1)(b).

Responsibility for compliance lies with the Company Secretary, both during the period of violation and for ongoing lapses. 

 As a result, ROC Delhi held that the Company Violated ESOP rules and imposed penalties.

 

COMPANY	₹2,00,000
PRESENT AND EX. CS (₹50,000 EACH)	₹1,00,000
PRESENT AND EX. CFO (₹50,000 EACH)	₹1,00,000
EXECUTIVE DIRECTORS AND CEO	₹2,00,000
Total Penalty	₹ 6,00,000

KEY TAKEAWAY

This case is a reminder that Company Secretaries, CFOs  are personally liable for ESOP compliance, and lapses can attract penalties even after leaving office.

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

UNUSUAL CORPORATE DISCLOSURE TO THE STOCK EXCHANGES ABOUT THE RESIGNATION OF AN INDEPENDENT DIRECTOR

 UNUSUAL CORPORATE DISCLOSURE TO THE STOCK EXCHANGES ABOUT THE RESIGNATION OF AN INDEPENDENT DIRECTOR

Dr. Alka Mundra just resigned as an Independent Director of Indian Oil Corporation Limited (18th September 2026).

Reason cited by Dr Alka Mundra is Her son has been running an Indian Oil retail dealership in Udaipur since 2020.

Here, Dr. Alka Mundra has explicitly cited a potential conflict of interest arising from her son’s Indian Oil dealership, even while asserting that her independence was never compromised.

SEBI’s Listing Regulations (Reg. 25) and Companies Act, 2013 emphasize that Independent Directors must avoid situations that could impair objectivity.

Independent Director Resignations are typically reported with standard reasons like “personal commitments,” “preoccupation,” or “health.”

Here, Dr. Alka Mundra has explicitly cited a potential conflict of interest arising from her son’s Indian Oil dealership, even while asserting that her independence was never compromised.

CONFLICT OF INTEREST SENSITIVITY:

SEBI’s Listing Regulations (Reg. 25) and Companies Act, 2013 emphasize that Independent Directors must avoid situations that could impair objectivity. Even if technically compliant, the perception of conflict can be damaging.

This case is a fascinating example of how perceived conflicts can be as impactful as actual conflicts in corporate governance.

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

E-VOTING BECOMES MANDATORY FOR GENERAL MEETINGS UNDER SECTION 108 READ WITH RULE 20 FOR A LISTED COMPANY OR ONCE A COMPANY REACHES 1,000 OR MORE MEMBERS.

 E-VOTING BECOMES MANDATORY FOR GENERAL MEETINGS UNDER SECTION 108 READ WITH RULE 20 FOR A LISTED COMPANY OR ONCE A COMPANY REACHES 1,000 OR MORE MEMBERS.

MANDATORY FOR:

·       All listed companies.

·       All companies with 1,000 or more members.

·       OPTIONAL (at the company’s discretion) for other companies.

SECTION 108: Grants members the right to vote electronically at general meetings.

RULE 20: Lays down the procedure for providing e‑voting facility, including:

·       Appointment of a scrutinizer.

·       Sending notice with e‑voting instructions.

·       Keeping the voting window open for at least 3 days before the meeting.

·       Ensuring votes cast electronically are counted along with physical votes.

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

NON-FILING OF BEN-2: ROC BANGALORE IMPOSES ₹10 LAKH PENALTY ON CHONGQING JIELI INDIA PRIVATE LIMITED

 NON-FILING OF BEN-2: ROC BANGALORE IMPOSES ₹10 LAKH PENALTY ON CHONGQING JIELI INDIA PRIVATE LIMITED

FACTS OF THE CASE 

Chongqing Jieli India Private Limited had a foreign holding company, Chongqing Jieli Wheel Manufacturing Co. Ltd., China, holding 99.99% of the shares of the Indian company.

During an inquiry under Section 206(4) of the Companies Act, the Inquiry Officer noted that the company had not filed Form BEN-2 with the Registrar of Companies.

ROC Bangalore imposed a penalty of ₹10 lakh on Chongqing Jieli India Private Limited for non-filing of BEN-2, reflecting serious lapses in compliance with the Companies Act, 2013. The order highlights the company’s failure to disclose beneficial ownership, a critical requirement under Section 90, and penalizes both the company and its officers in default.

WHAT IS THE LAPSE?

·       Section 90 mandates disclosure of significant beneficial ownership.

·       Rule 3 of the Companies (Significant Beneficial Owners) Rules, 2018 requires filing of BEN-2 within 30 days of receipt of BEN-1 declaration.

·       Non-compliance attracts penalties under Section 450/454 of the Act.

ARGUMENT BY THE COMPANY

The company submitted that its foreign holding company was itself held by four individuals:

• Ping Zeng–1%

• Sun Zhihao–33%

• Sun Haochun–33%

• Sun Yuqi–33%

The company's position was that none of these individuals individually held more than 50% of the holding company. Therefore, according to the company, none of them satisfied the "majority stake" test for indirect holding.

The company further stated that:

➡️No individual exercised control over the holding company;

➡️There was no written agreement giving any director control over management or policy decisions of the Indian company; and

➡️Consequently, Section 90 should not apply and there was no requirement to file BEN-2.

The company also referred to a legal opinion obtained from a PCS supporting its position.

WHAT DID ROC BANGALORE SAY?

ROC Bangalore did not accept this explanation.

The ROC referred to Section 90 read with the Companies (Significant Beneficial Owners) Rules, 2018 and observed that the relevant threshold for determining SBO includes an individual who holds, directly or indirectly, not less than 10% of the voting rights, along with the applicable control provisions.

The ROC specifically observed:

“the Directors who holds more than prescribed limits shall file BEN-1 to company and the Company has to file BEN-2.”

Accordingly, the ROC concluded that the company had violated Section 90 read with Rule 2(1)(h) of the SBO Rules.

The ROC specifically directed the company and officers to file:

MGT-6 and BEN-2 within 60 days from the date of the order, after following the due process.

BOARD & COMPLIANCE OFFICERS SHOULD THEREFORE ENSURE:

✔ Identification of SBOs

✔ Timely BEN-1 disclosures

✔ Verification of the information received

✔ Timely filing of BEN-2

✔ Maintenance of supporting records

A missed BEN-2 filing can become a significant corporate-law compliance exposure.

KEY TAKEAWAY

BEN compliance cannot be examined merely by looking at the immediate shareholder of the Indian company. Where the shareholder is a foreign body corporate, the ownership and control structure behind that entity becomes extremely important. “No individual holds more than 50%” should not, by itself, be treated as the end of the SBO analysis.

#Section 90 read with Rule 2(1)(h) of the SBO Rules,

The shareholding, voting rights, indirect holding and control arrangements need to be examined carefully before concluding that BEN-1/BEN-2 is not applicable.

 

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

STATUTORY AUDITOR FINED RS 10,000 FOR NOT COMPLYING AS-15 AND TRANSPARENT AUDIT REPORTING.

 STATUTORY AUDITOR FINED RS 10,000 FOR NOT COMPLYING AS-15 AND TRANSPARENT AUDIT REPORTING.

ROC BENGALURU VS SDU HOLDINGS PRIVATE LIMITED

ROC Bengaluru penalized the statutory auditor of SDU Holdings Pvt. Ltd. ₹10,000 for failing to qualify the audit report on non-provisioning of terminal benefits, treating it as a violation of Accounting Standard (AS) 15 read with Section 129 of the Companies Act, 2013.

The auditor’s defense of “immateriality” was rejected, and the penalty was imposed under Section 450 following the Companies (Amendment) Act, 2020.

ROC Bangalore did not accept this contention and imposed a penalty of ₹10,000 on the Statutory Auditor.

Materiality judgment was not adequately documented; omission constituted a reporting lapse.

This case underscores that even “small” lapses in employee benefit provisioning can trigger penalties for auditors, highlighting the importance of rigorous compliance with AS-15 and transparent audit reporting.

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

SEBI FINES VEERKRUPA JEWELLERS AND MERCHANT BANKER ₹16 LAKH FOR MISUSE OF IPO ESCROW MECHANISM

 SEBI FINES VEERKRUPA JEWELLERS AND MERCHANT BANKER ₹16 LAKH FOR MISUSE OF IPO ESCROW MECHANISM

FACTS OF THE CASE

IPO FUNDS RELEASED DIRECTLY FROM THE ESCROW ACCOUNT TO VEERKRUPA JEWELLERS BYPASSING THE COMPANY’S BANK ACCOUNT

SEBI penalized Veerkrupa Jewellers Ltd (VJL), its Managing Director Chirag Shah, and lead merchant banker First Overseas Capital Ltd (FOCL) with a total fine of ₹16 lakh because nearly the entire IPO proceeds (₹7.95 crore of ₹8.10 crore raised in July 2022) were released directly from the escrow account to gold vendors, bypassing the company’s bank account — a clear violation of SEBI’s Issue of Capital and Disclosure Requirements (ICDR) Regulations.

SEBI’S FINDINGS

VIOLATION OF ESCROW MECHANISM:

·       Funds must first be credited to the issuer’s bank account before utilization.

·       Merchant Banker FOCL instructed Axis Bank (banker to the issue) to transfer funds directly to vendors using Annexure A2 of the Escrow Agreement, which is meant only for intermediary expenses, not vendor payments

REGULATORY BREACHES:

Merchant Banker FOCL and its officials violated Regulations 271 & 272 of ICDR, 2018 and Merchant Banker Regulations.

Managing Director Chirag Shah breached fiduciary duties under LODR Regulation 4(2)(f)(iii)(3).

KEY POINT:

 SEBI clarified that even if the funds were ultimately used for the disclosed purpose (gold purchases), compliance with the prescribed release mechanism cannot be bypassed.

KEY TAKEAWAYS

IPO proceeds must always flow through the issuer’s account before utilization.

Operational convenience or industry practice cannot override SEBI’s prescribed mechanisms.

Even without misappropriation, lapses in fund release procedures attract penalties to safeguard market integrity.

Veerkrupa Jewellers’ case shows that SEBI enforces strict adherence to fund release protocols, penalizing both issuers and merchant bankers when IPO proceeds bypass the mandated escrow-to-issuer route.

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

WHAT IF CHANDRA SEKARAN'S APPOINTMENT AS CHAIRMAN OF TATA GROUP BY TATA BOARD IS NOT APPROVED BY THE MEMBERS IN THE COMING AGM AS NOEL TATA IS OPPOSING HIS APPOINTMENT?

 WHAT IF CHANDRA SEKARAN'S APPOINTMENT AS CHAIRMAN OF TATA GROUP BY TATA BOARD IS NOT APPROVED BY THE MEMBERS IN THE COMING AGM AS NOEL TATA IS OPPOSING HIS APPOINTMENT?

LEGAL & GOVERNANCE CONSEQUENCES

VACANCY IN CHAIRMANSHIP:

Mr. Chandrasekaran’s current term runs until February 2027, but reappointment at the AGM is essential for continuity.

If members reject his appointment, the board must immediately elect a new chairperson from among its directors.

DOMINANT ROLE TATA TRUST

Tata Trusts (holding ~66% of Tata Sons) have decisive voting power.

Noel Tata, as a trustee and family representative, opposing Chandra Sekaran could sway the outcome if the Trusts vote as a bloc.

QUORUM & PROCEDURAL RISKS:

Quorum clauses in Tata Sons’ Articles of Association require the joint nominee of Sir Dorabji Tata Trust and Sir Ratan Tata Trust.

If quorum itself fails, the AGM may stall, leaving Chandrasekaran’s reappointment unresolved.

SHARE MARKET TURBULANCE

If Mr. Chandrasekaran’s reappointment is not approved in the coming AGM, Tata Group companies—especially TCS, Tata Motors, and Tata Steel—could see volatility similar to the turbulence during Cyrus Mistry’s ouster in 2016.

TATA GROUP’S STRATEGIC PROJECTS AT RISK:

Chandrasekaran has been central to initiatives like Tata Digital, Air India’s turnaround, and semiconductor ventures.

His exit could slow or derail these projects until a new chairman sets direction.

POSSIBLE SCENARIOS

NOEL TATA AS SUCCESSOR

If Noel Tata is positioning himself against Chandrasekaran, he could emerge as a consensus candidate backed by Tata Trusts.

This would mark a return to family-led leadership after a decade of professional chairmanship.

INTERIM CHAIRMAN:

The board may appoint an interim chairman (possibly from independent directors) until a permanent successor is chosen.

LEGAL CHALLENGE:

Chandrasekaran could contest the rejection if procedural irregularities (like quorum failure) are involved.

OPPRESSION & MISMANAGEMENT

If Tata Sons’ members reject N. Chandrasekaran’s reappointment, courts could intervene if procedural irregularities or oppression claims arise. Indian precedents show that shareholder rejection of directors is valid if due process is followed, but tribunals and courts have stepped in when removals were oppressive, lacked probity, or violated Articles of Association.

KEY TAKEAWAYS

If Noel Tata successfully blocks Chandrasekaran’s reappointment, Tata Sons faces a leadership crisis, potential legal battles, and market turbulence. The Trusts’ dominance means succession will likely be resolved internally, but the choice between professional management and family leadership will define the group’s next decade.

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

SEBI IMPOSED A PENALTY OF ₹18 lakh ON LYPSA GEMS & JEWELLERY LTD FOR NOT ATTACHING A CERTIFICATE FROM PCS THAT NONE OF DIRECTORS ARE DEBARRED OR DISQUALIFIED IN ITS ANNUAL REPORT

 SEBI IMPOSED A PENALTY OF  ₹18 lakh ON LYPSA GEMS & JEWELLERY LTD FOR NOT ATTACHING A CERTIFICATE FROM PCS THAT NONE OF DIRECTORS ARE DEBARRED OR DISQUALIFIED IN ITS ANNUAL REPORT

SEBI VS LYPSA GEMS & JEWELLERY LTD

FACTS OF THE CASE

 SEBI IMPOSED A PENALTY OF  ₹18 lakh ON LYPSA GEMS & JEWELLERY LTD FOR FAILURE TO  attach in the  Annual Report of a listed entity  certificate from a Practicing Company Secretary confirming that none of the directors have been debarred or disqualified from being appointed or continuing as directors attacks penalty.

WHAT IS THE VIOLATION?

Under Regulation 34(3) read with Schedule V, Part C, Clause 10(i) of the SEBI LODR Regulations, the Annual Report of a listed entity is required to contain a certificate from a Practicing Company Secretary confirming that none of the directors have been debarred or disqualified from being appointed or continuing as directors.

LEGAL BASIS

Regulation 34(3) read with Schedule V of SEBI (LODR) Regulations, 2015: Requires disclosure of PCS certificate in Annual Report.

Section 118(11) of Companies Act, 2013: Non-compliance with Secretarial Standards attracts penalties.

IMPLICATIONS FOR LISTED COMPANIES

MANDATORY PCS CERTIFICATE:

Every listed entity must attach the certificate in its Annual Report; omission attracts SEBI adjudication.

DUAL LIABILITY:

 Non-compliance can trigger penalties under both SEBI LODR and Companies Act, 2013.

GOVERNANCE RISK:

Even small lapses (like missing certificates) are treated as systemic weaknesses.

INVESTOR CONFIDENCE:

Repeated disclosure failures damage credibility and ESG scores.

IMPORTANT COMPLAINT CHECK LISTS FOR LISTED COMPANIES

·       Ensure PCS certification on directors’ eligibility is attached annually.

·       Disclose cash flow & consolidated financials without exception.

·       Include auditor’s reports and AOC-1 statements in every filing.

 

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