IndiGo Co-Promoter Rakesh Gangwal Seeks EGM; Accuses Rahul Bhatia Of Questionable Related Party Transactions
[ By Bobby Anthony ]IndiGo Airlines co-promoter Rakesh Gangwal has informed the stock exchanges that he has sought an extraordinary general meeting of the company’s shareholders to discuss alleged violations of related party transactions of co-founder Rahul Bhatia.According to information filed with the stock exchange by Interglobe Aviation Ltd, Gangwal has accused co-founder Rahul Bhatia...
IndiGo Airlines co-promoter Rakesh Gangwal has informed the stock exchanges that he has sought an extraordinary general meeting of the company’s shareholders to discuss alleged violations of related party transactions of co-founder Rahul Bhatia.
According to information filed with the stock exchange by Interglobe Aviation Ltd, Gangwal has accused co-founder Rahul Bhatia of questionable related party transactions, besides violations of governance regulations as well as the company’s code of conduct.
In a letter dated July 8, Gangwal informed Securities and Exchange Board of India (SEBI) chief Ajay Tyagi that corporate governance norms as well as the company’s code of conduct for directors had been violated by Indigo Airlines co-founder Rahul Bhatia.
Gangwal’s letter has stated that he wants shareholders at the EGM to vote on two resolutions. The first resolution would be to ensure that the company, its board of directors and senior management adhere to requirements in the company's Code of Conduct for Directors and Senior Management.
The second resolution would be to recommend to the board and audit committee, certain reasonable procedures as well as safeguards to be put in place regarding entering into related party transactions with Rahul Bhatia and his affiliates (IGE Group).
The letter has accused Rahul Bhatia of violating the code of conduct and executing various related party transactions without seeking the audit committee’s approval. Various related party transactions were executed without seeking competitive bids from third parties, while other related party transactions were signed, allegedly with retrospective effect (back dated), Gangwal’s letter stated.
Earlier, in November 2018 Gangwal had written to all board members about these transactions.
It was decided to evaluate and examine these related party transactions, while Rahul Bhatia wanted auditors to do a “limited review,” Gangwal’s letter stated.
As things stand, SEBI has asked InterGlobe Aviation for details by July 19.