Former Tata group executive Nilendu Narayan Chakraborty has tendered his resignation as Independent Director of the Brightcom Group, citing health issues and higher board responsibilities, following the exits of key operating personnel.
Chakraborty, who was appointed in December 2021, said the recent actions by statutory authorities against the company and key executives had resulted in an operationally challenging situation. The exits of key operating personnel had led to a significant shift in the responsibilities being placed upon the Board, he said.
“Increasingly, the Board is facing situations where executive/management decisions have to be taken which is not within the remit of independent non-executive directors. It is also challenging for me to have any part in the implementation process, given my situation. This is putting unforeseen demand on my time and energy thus jeopardising my salaried livelihood,” Chakraborty said in his resignation addressed to the Board of Directors.
Chakraborty said he was a full-time salaried employee in a senior position in a commercial establishment outside India, and was reliant on this salary for his livelihood. He had assumed that his role as an independent director at BCG would be limited to occasional meetings (mostly remote) and providing guidance to the Board based on earlier experience.
The recent events, however, had taken a toll on his health and he was unable to dedicate time and attention that the responsibility of being a member of the Board demands, he added.
“I wish to categorically state on oath that besides nominal sitting fees, I have not received any other benefit and neither have I ever knowingly partaken in any act or decision that might be considered illegal or immoral,” said Chakraborty who has over two decades of experience in the corporate finance and controls.
SEBI orders
SEBI had passed an interim order in April against the Brightcom Group for an accounting fraud involving manipulation of financial statements for several quarters and irregularities amounting to about ₹1,300 crore.
In August, SEBI issued another interim order barring Group Chairman and CEO Suresh Kumar Reddy and CFO Narayan Raju from holding the position of a director or key managerial personnel in any listed company or its subsidiaries. Reddy was additionally barred from buying, selling or dealing in securities, either directly or indirectly.
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Both CMD and CFO resigned following the order.
SEBI pointed to irregularities in preferential allotments by the Brightcom Group during FY21 and FY22. The Group had issued warrants/shares on a preferential basis on four occasions and raised ₹867.78 crore from 82 allottees.
According to SEBI, the Group had financed these preferential issues by round-tripping or circuitous movement of funds to certain allottees through its subsidiaries, promoter cum CMD and other conduit entities.