IndiGo promotor Rakesh Gangwal has flagged serious corporate governance lapses at the company. In a letter to market regulator SEBI on Tuesday, Gangwal said that even a "paan ki dukaan" (betel shop) would have managed matters with more grace.
Gangwal has made these allegations while he is engaged in a bitter tussle with co-founder Rahul Bhatia. Gangwal, along with his affiliates, holds around 37 per cent stake in InterGlobe Aviation. Co-founder Rahul Bhatia and his affiliates (IGE Group) has around 38 per cent stake. InterGlobe Aviation (or IndiGo) is also the parent of the country's largest airline IndiGo.
In his letter to SEBI, Gangwal has alleged Bhatia of indulging in questionable related-party transactions. According to him, the shareholders' agreement provides Bhatia unusual controlling rights over IndiGo. He stated that the company "started veering off" from the core principles and values of governance that made the company what it is today.
"Beyond just questionable Related Party Transactions, various fundamental governance norms and laws are not being adhered to and this is inevitably going to lead to unfortunate outcomes unless effective measures are taken today," Gangwal said in the letter.
Gangwal has also sent a copy of the letter to Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman, Civil Aviation Minister Hardeep Singh Puri and Commerce Minister Piyush Goyal among others.
After Gangwal wrote to the board seeking an extraordinary general meeting, Bhatia, on June 12, opposed the proposal. Bhatia wrote to the board alleging that the genesis of Gangwal's angst was his "hurt ego" and refusal of IGE Group to entertain his "unreasonable demands".
Meanwhile, SEBI has sought details from InterGlobe Aviation against the complaint filed by Gangwal. IndiGo's parent firm has been asked to furnish its response by July 19.
In a stock exchange filing, the company has also confirmed that its board of directors has received a letter from Gangwal.
SEBI has been probing the matter since reports surfaced about differences between the two key promoters, PTI reported. Reportedly, there are differences between Gangwal and Rahul Bhatia over certain related-party transactions.
Shares of InterGlobe Aviation closed marginally lower at Rs 1,
(Edited by Vivek Punj with PTI inputs)