Government company Coal India Limited (CIL) said on Monday that due to non -appointment of independent directors in its board, he has been fined ₹ 10.72 lakh. The company said in the regulatory filing that both BSE and NSE have fined ₹ 5.36 lakh- ₹ 5.36 lakh due to violation of SEBI rules.
Violation of Regulation 17
SEBI (LODR) Regulation 17 is mainly associated with corporate governance rules. This includes disturbances such as the wrong structure of the board (such as independent directors deficiency), not passing special resolutions for non-executive directors above 75 years of age, or not organizing minimum four meetings of the board.
Cleaning of Coal India
CIL said that all the members of the board are appointed by the President of India, so the appointment of independent directors in the board does not come under its jurisdiction. The company said that in this case it is constantly in touch with the Ministry of Coal.
The company said that it has appealed to both NSE and BSE to waive the fine. Earlier, the exchanges had taken a positive decision on his appeal for his apology. Currently, the board of CIL has six independent directors.
MTNL also fined
Government telecom company Mahanagar Telephone Corporation Limited (MTNL) has imposed a fine of ₹ 6.73- ₹ 6.73 lakh by stock exchanges- NSE and BSE. The company informed in regulatory filing on Saturday that the penalty has been imposed in the board for not following the rules of SEBI (LODR) Regulations, 2015.
Causes of violation of rules
Exchange said that MTNL has not followed the rules in many cases. These include,
Responsibility on government
MTNL said in its statement that it is a public sector undertaking (PSU) and all the board members, including independent directors, are appointed by the Department of Telecommunications (DOT).
The company said that two independent directors have been appointed from April 15, including a female director. At the same time, the matter of appointment of four more independent directors is under consideration with the government. MTNL also said that it has appealed to forgive the fine imposed from both NSE and BSE.
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