Centre slaps fines on Sun Pharma CMD and directors over related-party transactions

Sun Pharmaceutical Industries Ltd on Thursday said the Ministry of Corporate Affairs has levied penalties on certain past and present directors and officials, including CMD Dilip Shanghvi, for non-disclosure and not obtaining approval of its board and shareholders for certain related-party transactions.

The company has received an order from the Regional Director, North Western Region, Ministry of Corporate Affairs, for alleged violations of certain provisions of the Companies Act, 2013, Sun Pharmaceutical Industries said in a regulatory filing.

"A total combined compounding fee is levied on certain past and present directors/officers of the company -- Dilip Shanghvi (Rs 9.5 lakh), Sudhir Valia (Rs 9 lakh); Sailesh Desai (Rs 9 lakh); K Subramanian (Rs 1.5 lakh); Uday Baldota (Rs 6 lakh) and C Muralidharan (Rs 1.5 lakh)," the filing said.

This matter pertains to the earlier investigation carried out by Sebi, in which a settlement was reached with the markets regulator in February 2021 without admission or denial of guilt; however, on the same matter, the Ministry of Corporate Affairs also initiated an investigation in parallel in 2019, it added.

These additional orders pertain to the application of compounding of offences for alleged violation under Section 129 and Section 188 for non-disclosure of certain transactions with related parties in the board's report and financial statements for the financial years ranging from 2015-16 to 2018-19, the company said.

Further, the alleged violations also include not obtaining approval of the board/shareholders for a related party transaction with Aditya Medisales Ltd for the financial years 2014-15 to 2017-18, Sun Pharma said.

For the subsequent periods, the related party transactions have been duly disclosed in the board's reports/financial statements, and necessary approvals have been obtained, it said.