GRSE Faces Fines Over Governance Lapses

Garden Reach Shipbuilders & Engineers Ltd received notices for non-compliance with corporate governance provisions after the absence of independent directors, including a woman. A fine was imposed for each offense. The company asserts the government is responsible for appointments and requests penalty waivers.

Garden Reach Shipbuilders & Engineers Ltd (GRSE) has been flagged by both the National Stock Exchange and BSE for breaching corporate governance rules, specifically under SEBI's listing obligations, during the last quarter.

The violations pertain to regulations ensuring the presence of independent directors, including a woman independent director, and the proper formation of the audit and nomination committees. Each exchange has fined GRSE Rs 9,77,040, inclusive of GST, for the deficiencies.

GRSE argues the lapses are due to delayed government appointments of board directors, an action beyond company control, and is actively seeking resolution with the Ministry of Defence to meet SEBI's governance standards.

(With inputs from agencies.)