Directors of IL&FS Financial Services (I-FIN) and IL&FS Transport Network, where accounts were not found to be in order, are facing similar action, official sources told TOI.
A large part of the amount is to be recovered from four key directors – Ravi Parthasarthy, Arun Saha, Hari Sankaran and Ramesh Bawa – with the sum adding up to over Rs 100 crore. Milind Patel, Rajesh Kotian, and Vibhav Kapoor are some of the other directors, who face similar action.
The independent directors, some of whom are big names in the corporate sector, have to refund a part of the commission paid during their tenure when the fraud was perpetuated. The list includes prominent names, such as, Maruti Suzuki chairman R C Bhargava, VBHC founder and director Jerry Rao, former HDFC boss K M Mistry, former LIC chairman S B Mathur, retired civil servant Michael Pinto and Rina Kamath.
After TOI first reported about the revised accounts on May 6, a former independent director had said that board members like them should not be held responsible as they were not responsible for day-to-day functioning of the entities and went along with the accounts that were presented and discussed at the board meetings.
The boards of IL&FS, I-FIN and ITNL had recast the financial statements for five financial years as mandated by NCLAT and submitted their findings to the ministry of corporate affairs (MCA). The company has also filed these accounts with NCLT so that they can be taken on record.
When contacted, an IL&FS spokesperson said: “All three companies, IL&FS, IFIN and ITNL, have written letters to their erstwhile directors informing them of the excess managerial remuneration paid to them between FY2013-18. They have been asked to refund the excess managerial remuneration to the company under applicable laws. These amounts have been computed based on the recasted statements for FY2013-18.”
An official source said the action has been initiated under sections 197 and 198 of the Companies Act. Companies Act, 1956, which was replaced by a new law, had stricter provisions related to directors of companies whose boards were superseded as it made them ineligible for board seats in future.
