Mumbai, Nov 29 Garden Reach Shipbuilders & Engineers Limited (GRSE) on Saturday said that it received notices from both the National Stock Exchange (NSE) and the BSE for not meeting certain corporate governance rules during the quarter ending September 30.
In a regulatory filing, the defence public sector company said the exchanges pointed out violations related to independent directors.
These include the requirement to have enough independent directors on the board, the need for a woman independent director, and proper formation of the audit committee and the nomination and remuneration committee.
For these shortcomings, each exchange has imposed a fine of Rs 9,77,040, including GST.
"We hereby inform you that the company has received notices dated November 28 from National Stock Exchange of India (NSE) and BSE Limited (BSE) regarding non-compliance with the provisions of Reg 17 (1), 18 (1) and 19(1)/19(2) of the SEBI LODR, 2015 pertaining to non-availability of required Independent Directors including Woman Independent Director on the Board of the Company, non-constitution of Audit Committee and Nomination and Remuneration Committee during the quarter ended September 30,” the company said.
“In view of the said non-compliances, a fine of Rs 9,77,040/- (incl. GST) has been imposed by each of the Stock Exchanges i.e. NSE & BSE,” it added.
GRSE said it has replied to the notices, explaining that as a central public sector enterprise under the Ministry of Defence, appointments to its board -- including independent and woman independent directors -- are made by the Government of India through Presidential Orders.
The company said the non-compliance happened only because the government had not appointed the required directors on time, and that this situation was beyond its control. GRSE has requested the exchanges to waive the penalties.
It also said that it is actively following up with the Ministry of Defence, its promoter, to fast-track the appointment of the needed independent directors so it can fully meet SEBI’s corporate governance requirements.
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