New Delhi, Feb 26 (IANS) Indigo CEO Ronojoy Dutta on Wednesday said that the company has responded to all queries by the Securities and Exchange Board of India (SEBI) on related-party transactions (RPTs).
In a statement, he also reiterated that the company has not received any communication from the market regulator regarding any outcome of any preliminary enquiry by it.
Dutta’s statements comes after reports that SEBI had found several undisclosed RPTs between InterGlobe Enterprises and IndiGo.
“IndiGo strongly denies any allegations of wrongdoing or avoidance of processes. It reiterates that it has strong processes for ensuring arm’s length dealings with related parties and that such transactions were entered into in the ordinary course of business and were in the best interests of IndiGo,” he said.
The issue of related party transactions has been a pressure point between IndiGo co-founders, Rakesh Gangwal and Rahul Bhatia. The feud between the two airline co-founders came to light on June 8 after Gangwal wrote a letter to SEBI, raising issues related to RPTs and corporate governance.
While Gangwal and his family hold 37 per cent stake in the company, Bhatia and family control 38 per cent in the country’s largest private carrier with nearly 50 per cent market share on local routes.
In his letter, Gangwal alleged that basic governance norms and laws were not being followed by the company apart from questionable RPTs. He said that the lapses, if not corrected, will lead to unfortunate outcomes.
Highlighting that Bhatia has unusual controlling rights over IndiGo with the right to appoint three out of six directors besides the MD, CEO and President, he implied that such rights were not being exercised fairly.