Exchanges Fine IOC, GAIL, ONGC For Fourth Consecutive Quarter For Flouting Listing Norms

The exchanges levied a cumulative fine of Rs 34 lakh on the oil marketing companies, namely IOC, HPCL, and BPCL, along with explorers OIL, ONGC, gas giant GAIL, and refiner MRPL

Listing norms need firms to include independent directors in the same proportion to executive or functional directors and also demand the companies to have at least one female director on the board

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State-owned oil and gas firms like IndianOil, ONGC, and GAIL (India) Ltd received fines for the fourth consecutive quarter for failure to meet listing requirements. The firms were fined by the exchanges as they were unable to meet the required number of directors on their board.

The exchanges levied a cumulative fine of Rs 34 lakh on the oil marketing companies, namely Indian Oil Corporation (IOC), Hindustan Petroleum Corporation Ltd (HPCL), and Bharat Petroleum Corporation Ltd (BPCL), along with explorers Oil India Ltd (OIL), Oil and Natural Gas Corporation (ONGC), gas giant GAIL, and refiner Mangalore Refinery and Petrochemicals Ltd (MRPL), reported PTI. 

The firms failed to fulfil the listing norms in the January-March quarter, official filings with the exchanges revealed. The companies also informed that both BSE and NSE imposed fines for either failure to appoint the needed number of independent directors or the mandated women director in the last quarter of the 2023-24 fiscal year (FY24). However, they noted that these appointments were conducted by the government. 

IOC, HPCL, BPCL, OIL, MRPL, and GAIL revealed that they received fine intimations worth Rs 5,36,900 each, and they were fined for the same reason in the preceding three quarters as well. Meanwhile, ONGC was slapped with a fine of Rs 1,82,900. 

Notably, listing norms need firms to include independent directors in the same proportion to executive or functional directors and also demand the companies to have at least one female director on the board.

IOC noted that the appointment power for the director posts rests with the Ministry of Petroleum and Natural Gas, Government of India, and therefore, the failure to meet the listing norms didn’t indicate negligence/default on behalf of the company.

The firm further said that it shouldn’t be held responsible for paying these fines and that it regularly brings up the appointment issue with the ministry. It added that it received such notices earlier also from the exchanges and waiver requests from the firm’s end were considered favourably by both BSE and NSE. HPCL and BPCL also shared similar statements, while GAIL maintained that appointments remained outside the company management’s control.