Kiran Mazumdar Shaw settles case with Sebi

New Delhi: Kiran Mazumdar Shaw, lead independent director of Infosys, has settled with Sebi a case of alleged delay in making disclosure regarding change in her shareholding in the IT company by paying over Rs 3 lakh as settlement charge.

Mazumdar Shaw, who is also chairman of Biocon, was alleged to have violated provisions of the Prohibition of Insider Trading (PIT) regulations.

The Securities and Exchange Board of India (SEBI) had conducted an examination in the matter of Infosys and observed that Mazumdar Shaw had delayed making the requisite disclosures with respect to change in her shareholding in the company.

However, before proceeding further and initiating proceedings against her, the regulator sent notice of settlement to her, intimating that the proceedings may be settled and disposed of upon filing of an application settlement mechanism of Sebi along with remittance of settlement amount of over Rs 3.01 lakh.

Accordingly, she filed a settlement application without admitting or denying the default and remitted Rs 3,01,758 in September 2019.

"This order disposes of the proceedings that may be initiated for the defaults," Sebi said in an order passed on Wednesday.

Besides, it added that enforcement actions including commencing proceedings against the applicant may be taken if any representation made by the applicant is subsequently discovered to be untrue.

In February, Infosys had said that Mazumdar Shaw had inadvertently through her portfolio management services sold 1,600 shares of the company without obtaining pre-clearance of trade.

Following a review by the audit committee of the company's board of directors that determined that there was a violation of the Infosys' insider trading policy and the PIT norms, a penalty of Rs 9.5 lakh was imposed on Mazumdar Shaw.