Three directors resign from PFS board

Mumbai: Former managing director of the insurance behemoth and IPO-bound LIC, Thomas Mathew has resigned from the post of independent director of PTC India Financial Services (PFS) along with two other independent directors - Kamlesh Shivji Vikamsey and Santosh B Nayar.

The PFS has said that it would conduct an investigation on the issue of corporate governance.

It was followed by the PTC India's defending itself from allegations of serious lapses in corporate governance and compliance made by three independent directors of its subsidiary -PTC India Financial Services (PFS) - after they handed in their resignations, Rakesh Kacker -who had served as an independent director on the PFS board until December 31, resigned from the board of PTC India with immediate effect.

The announcement by PTC India to the stock exchanges came hours after the company's Chairman and Managing Director Rajib K Mishra told the media that a fair inquiry would be conducted into the alleged corporate governance issues at PFS that were raised by the three independent directors. In his resignation letter, Kacker said that despite best efforts, the "independent directors could not convince the management of PTC and PFS to take proper action to run the company in accordance with what we considered the correct course of action".

"As a result, the company is now facing serious governance issues with several defaults of the Companies Act, 2013, and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. Due to this, the operations of the company also must have been affected," he said in the letter to the stock exchanges. "It has now been brought to my notice that all three current independent directors in PFS have resigned from their positions... In view of the various developments and reasons leading to their resignations, I find myself left with no option but to resign from the board of directors of PTC India Limited with immediate effect," he said. PFS, a systemically-important Non-Banking Finance Company (NBFC), is promoted by PTC India.

Earlier in the day, Rajib K Mishra, who is also on the board of PFS, said that a fair inquiry would be conducted into the alleged corporate governance issues at PFS. He also said that if required, a third party could be asked to probe the matter

In their resignation letters, the three independent directors had alleged that certain actions of the chairman of the board and managing director of the company are "ultra-vires" and "in violation" of the provisions of the Companies Act, 2013. The independent directors had also referred to issues regarding a Rs 125 crore bridge loan given to NSL Nagapatnam Power and Infratech, besides alleging that "no action" has been taken on certain corporate governance matters.