Private lender ICICI Bank on Monday refuted paying salary or issuing any stock options to Sebi chair and former bank employee Madhabi Puri Buch, hours after Indian National Congress spokesperson Pawan Khera alleged Buch received ₹16.8 crore from the group between FY18 and FY24.
The Bank or its group companies have not paid any salary or granted any ESOPs to Madhabi Puri Buch subsequent to her retirement, other than her retiral benefits. This is to further note that she had opted for superannuation with effect from 31 October 2013, said the bank in a regulatory filing.
She was paid her salary, retiral benefits, bonus and Esops in accordance with the then applicable policies during her tenure with the ICICI Group," it said.
"Under the Bank's ESOP rules, the ESOPs vest over the next few years from the date of allotment. According to the rules in force at the time of her ESOP grant, employees-including retired employees-had an option to exercise their ESOPs any time up to a period of 10 years from the date of vesting, it said and added that all the payments made to Buch post retirement had accrued to her during her employment phase with the ICICI Group .
These payments comprise ESOPs and the retiral benefits.
An e-mail sent to the Sebi spokesperson was not replied till the time of going to Press.
In a press conference on Monday, Khera alleged that Buch drew more than ₹12 crore as salary from the ICICI Bank between 2017-18 and 2023-24. Khera further alleged that during the same period, Buch received an income from "ICICI Prudential" over ₹22 lakh; income from employee stock ownership plan exercise ₹2.8 crore for FY22 and FY23; and TDS on the Esop for FY22 and FY23 over ₹1 crore.
Khera also complained that Buch had infringed the service rules relevant for employees, code on conflict of interest relevant for board members and ICICI employees stock option scheme.
The complaint against Buch comes within a month after US short-seller Hindenburg Research accused that the Securities and Exchange Board of India's investigations into its January 2023 report of an accounting fraud and manipulation of shares by the Adani Group was compromised.
Hindenburg explained this was because Buch had a stake in offshore entities that the Adani Group had allegedly used to siphon money-off apart from impropriety and conflict of interest rising from her ownership of consulting firms. The allegations were repeatedly denied by Buch and Adani Group.
Subhash Chandra, chairman emeritus of Zee group, which has been under the Sebi's scanner, on Monday said he will cease cooperation with the regulator. Addressing a press conference in Mumbai, Chandra also said he is exploring legal action against Sebi chairperson.
Buch's current three-year tenure as chair ends in March next year.
Khera also pointed out several conflicts of interests, including that of the chairperson in the Supreme Court-monitored investigation into the allegations made by Hindenburg against Adani.
A corporate governance expert, speaking on condition of anonymity, said, "Even if the Esops were retiral benefits, there needed to be public disclosure."
Let me be frank: Buch joined ICICI bank in the year 1989 in project finance. She left in the year 1992 and worked in ANZ Grindlays Bank and ORG MARG Research before joining the same bank again in January 1997 in planning and treasury.
Securities lawyer Chirag M Shah said, "The question of propriety whether a Sebi chairperson gets ESOPs from a former employer is not relevant as ESOPs are granted after approval of the general body of the employer and vest at a point in time in future when the employee pays for the options." After this it becomes an absolute property of the person and no more linked to employment.
"Even if one leaves the job, the shares can remain in their portfolio. Disclosure of such and other investments is made routinely by such senior level appointees as mandated under law. Conflict is decided by an internal Committee of the Board and cannot be a subject matter of wild accusations and conspiracy theories," said Shah.
This is a highly improbable event to have occurred in the first place," said Sumit Agrawal, partner, Regstreet Law Advisors and former Sebi official.
"The concept of deferred remuneration, and other monetary aspects such as perquisite, salary income, Esops, dividends, etc., all represent a host of diverse concepts that come under different legal jurisdictions. All these monetary aspects come under different legal jurisdictions and laws such as tax laws and other related legislations necessitating different requirements such as disclosures," he said.
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