Manoj Kumar Jhawar takes additional charge as Mishra ceases to be PTC CMD

New Delhi: The board of PTC India Ltd approved the appointment of whole-time director Manoj Kumar Jhawar as the chairman and managing director of the company till the appointment of a regular CMD.

Rajib Kumar Mishra ceased to be CMD after market regulator Sebi on Wednesday barred him from holding any post on the board or management of any listed company for a period of six months over alleged corporate misgovernance in its subsidiary PTC India Financial Services (PFS).

"The board of PTC India Ltd in its meeting held on 13th June 2024 has decided that till a regular CMD is appointed, Dr. Manoj Kumar Jhawar, the current whole time director shall also exercise the powers of Chairman & Managing Director as have been delegated by the Board from time to time w.e.f. 13th June 2024," PTC said in a regulatory filing on Thursday.

Sebi's action

The market regulator barred Mishra and the former MD of  PFS, Pawan Singh from holding any position on the board or management of a listed company for a period of six months and two years respectively.

It also imposed penalties of ₹10 lakh and ₹25 lakh respectively on Mishra and Singh.

In its order on Wednesday, it said that both Mishra and Singh are "restrained from holding any position of director or key managerial personnel in any listed company or any intermediary registered with Sebi, or associating himself with any listed public company or a public company which intends to raise money from the public or any intermediary registered with Sebi, in any capacity".

Also Read: Why Sebi’s reviewing the eligibility criteria for derivatives trading

The market regulator said its investigation had found that Singh had "grossly misused his position as the MD and CEO of PFS to prevent Mr. Ratnesh from joining as WTD (whole time director) (Finance) and CFO, which was approved by the Board of PFS". 

It noted that the MD-CEO in a company, though sitting at a high position within the management hierarchy, is duty-bound to follow the decisions of the board and cannot exercise his power unilaterally in an unfettered manner.

"However, in this case, the MD & CEO employed all the tricks to defeat the decision of PFS Board to appoint Mr. Ratnesh, thereby keeping a critical vacancy in the company unfilled." The board had approved the appointment in its meeting on 28 August, 2021.

Also Read | Mint Explainer: Sebi’s beef with virtual trading apps

Ratnesh Kumar was a Chief General Manager at NTPC before the board of PFS approved him as Director Finance. However, he went back to NTPC after his appointment was stalled by Singh.

Corporate governance lapses

Alleged lapses of corporate governance also included delays in disclosure of a forensic audit report (FAR) by Pawan Singh on loans to Nagapatnam Power and lnfratech Pvt Ltd to the board of PFS two years after the audit had been completed.

On Mishra, the order said that he was acting as a "willing accomplice" of Singh.

The order noted that Mishra, being the chairman of PFS, had all the authority to set things right by looking into the issues raised by the independent directors.

The instances of misgovernance came to light when three independent directors resigned from the board of PFS flagging concerns over corporate governance issues in January, 2022.

Also Read: Suzlon has wind in its sails despite ‘corporate governance’ hiccups

Showcause notices were sent to both Mishra and Singh in May last year and in June 2023 year Singh was sent on leave till his superannuation in October 2023.

"The said acts of disregarding regulators’ directions reflected poorly on the conduct of Noticees 1 (Singh) and 2 (Mishra), as Board members of PFS," the order said.