Undisclosed related-party transactions: Interglobe settles case with Sebi, pays Rs 2.13 crore

Interglobe Aviation, the parent firm of the country's largest airline IndiGo, reached a settlement with the Securities and Exchange Board of India (Sebi) in a case pertaining to non-disclosure of related-party transactions (RPTs).

The company has paid a settlement amount of Rs 2.13 crore, stated the settlement order issued by the market regulator on February 9.

Interglobe had, in January, moved an application before Sebi seeking to close the case. A show-cause notice had been issued to the company last year when the regulator had asked it to explain why action should not be initiated.

In its application, Interglobe had "proposed the payment of Rs 2,10,37,500 towards full and final settlement" of all regulatory, civil or criminal proceedings "without admitting or denying any violation on its part", said the settlement order issued by adjudicating officer G Ramar.

The Sebi had, in its preliminary enquiry, reportedly found several RPTs between InterGlobe Enterprises and IndiGo that were not disclosed as per the required procedure.

The issue of RPTs had become a bone of contention between IndiGo co-founders, Rakesh Gangwal and Rahul Bhatia.

Gangwal, in his complaint to Sebi in 2019, had alleged that the companies affiliated to InterGlobe Enterprises, which is privately held by Bhatia, had benefitted from transactions with IndiGo. InterGlobe Enterprises owns 37.87 percent in listed InterGlobe Aviation, the operator of IndiGo.