Tata Motors Finance pays Rs 32 lakh to settle NCD issue case with Sebi

New Delhi: Tata Motors Finance Ltd (TMFL) has settled a case with markets regulator Sebi over alleged violations related to the issuance of non-convertible debentures (NCDs) after paying a settlement amount of Rs 32 lakh.

According to Sebi’s order, TMFL filed a suo motu settlement application, proposing to resolve the matter without admitting or denying the findings of fact or conclusions of law.

The settlement relates to five issuances of Tier II perpetual NCDs made on a private placement basis between November 2019 and July 2022.

The issuances included unlisted NCDs aggregating Rs 460 crore.

Sebi noted that the debentures were sold to more than 200 investors within six months of allotment.

As a result, the regulator held that the issuances were deemed to be public issues, in violation of provisions of the Companies Act, 2013, Sebi’s Issue and Listing of Non-Convertible Securities Regulations and the Issue and Listing of Debt Securities Rules.

Following the filing of the settlement application, TMFL submitted revised settlement terms, which were subsequently approved by Sebi.

The company then remitted the settlement amount, leading to the resolution of the matter.

“It is hereby ordered that any proceedings that may be initiated for the violations are settled in respect of the applicant,” Sebi Whole Time Members Amarjeet Singh and Sandip Pradhan said in the order.

The regulator added that it would not initiate enforcement action against Tata Motors Finance Ltd for the violations covered under the settlement.

However, Sebi clarified that it retains the right to take appropriate action in the future if any representations made during the settlement proceedings are found to be untrue, or if the company breaches the settlement terms.