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Infosys moves RoC to settle Rajiv Bansal severance pay case

Infosys moves RoC to settle Rajiv Bansal severance pay case
Photo Credit: Reuters
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Bengaluru-based information technology services firm Infosys has moved the Registrar of Companies (RoC), Karnataka, to settle the case pertaining to former chief financial officer Rajiv Bansal, it said in a statement to the stock exchanges.

The case relates to the payment of severance pay that the company agreed to pay the former CFO even though no such policy was part of the firm's remuneration policy. Earlier this year, Infosys had paid up Rs 39 lakh as a fine to markets regulator Securities and Exchanges Board of India (SEBI) to close the case after SEBI found that the payment was not in accordance with Infosys' remuneration policy.

"The company has applied for compounding to put this legacy matter to rest. The company will provide an update on the conclusion of the compounding process," Infosys said in a statement.

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The country's second-largest IT exporter said that the company had submitted applications with the RoC, Karnataka, Bengaluru under Section 441 of the Companies Act, 2013 (“Act”) for the compounding of certain alleged offences that pertain to matters relating to the severance agreement executed with the former CFO of the company in October 2015.  

"Through the compounding process, the company seeks to resolve the alleged offences under the Act relating to: (i) the Company not seeking prior and separate approvals required as per the Act from the Nomination and Remuneration Committee, Audit Committee and the Board of Directors of the Company with regard to the Agreement; and (ii) not making the requisite disclosures," the statement said.

The high severance pay had raised several eyebrows in the company known for paying modest salaries to most of its senior executives. Infosys co-founder N R Narayana Murthy had termed this severance payment hush money.

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Bansal resigned from the company in October 2015. Later on, a whistleblower allegation surfaced claiming that the IT major overpaid for the Panaya acquisition done under chief executive Vishal Sikka. The same allegation resulted in Sikka finally leaving the company. While Infosys did not disclose the details of the investigations, it said that it did not find any discrepancies in the deal.

According to Infosys, in these applications to settle the issue, the company has made multiple submissions including those setting forth their good faith belief on compliance with relevant provisions of the Act and having acted in an honest, reasonable and diligent manner and in the best interests of the company and its shareholders and without any intent to avoid or act in breach of any obligations under the Act.

Infosys is in the middle of another whistleblower allegation, whereby the "ethical employees" group has alleged that the company has inflated its revenue and margin numbers. Infosys has initiated multiple probes to find out whether there is any truth to the allegations.

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Separately, Infosys has launched a new ATP Tour app that will help tennis fans to access live scores, stats, news, video and a personalised feed featuring their favourite players and tournaments. 

The app has been designed by the London-based design lab of Infosys, Brilliant Basics.

According to an Infosys statement, the new app has been designed by adhering to the principles of digital transformation as well as keeping the fans at the centre of focus. The app can deliver customised notifications about match according to their preferences. Infosys is also the digital innovation partner of Rolland Garros, the venue of the French Open.

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