Sunday, May 22, 2022

PTC India Chairman promises probe into allegations of corporate governance lapses

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  • An internal committee is expected to submit a report in 30 days on the matter
  • PTC India will also hold its first board meeting on January 22 after the three Independent Directors quit, levelling serious allegations pertaining to lapses in corporate governance

New Delhi: Day after three Independent Directors quit the board of PTC India, levelling serious allegations pertaining to lapses in corporate governance and operations at financial lending units of the company, Chairman Dr Rajib Mishra has promised an investigation into the matter and has also formed an internal committee which is expected to submit a report in 30 days. PTC India will also hold its first board meeting on January 22 after the allegations came to light. 

Dr Mishra, who addressed a press conference on Friday, did not divulge the agenda of the meeting. 

Independent audit firm to probe allegations levelled by outgoing Directors

“PTC India is committed for highest standard of #corporategovernance Governance & Ethics and safeguard interest of all the #stakeholders. Company has taken steps to examine the issues by independent #Audit firm,” Dr Mishra said in a tweet on January 20.

PTC India has refuted the allegations levelled against it in an official statement released on January 20 and had said that the matter will be addressed at the board level. “There are differences of opinion at operation and board level of PFS on a few issues. These issues are of legacy in nature and are being looked into by a senior level committee. We have taken steps to address the governance issues,” said the statement.

Backdrop

The three Independent Directors, who have tendered their resignation, have claimed that a number of problems being faced by them were “either given a deaf ear to or were rejected time and again” by the company’s management. The directors have accused the company’s management of extending a bridge loan of Rs 125 crore to NSL Nagapatnam Power and Infratech Private Limited without the knowledge of the Board of Directors. That such a loan had been extended to NSL came to light before PTC’s board only after insolvency proceedings were underway against NSL. When the board took cognisance of the matter and formed a committee of two independent directors to look into it, it had to face “inordinate delay in getting required documents and correspondence from the management for its work,” the outgoing directors have alleged. 

The directors have also claimed that the board of the company had expressed concern over the unilateral and unauthorised changing of terms and conditions of loan extended to Patel Darah-Jhalawar Highway Private Limited and a report was sought on it by October 2021, which is yet to be submitted to the board.

“The lack of action on the part of the company management is alarming, especially since the company is a listed company and has obligations to not just itself as an entity but also its investors,” one of the letters written by the directors states. 

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