'Breach of privacy': Sebi chief Madhabi Puri Buch, husband issue statement on impropriety charges

NEW DELHI: Securities and Exchange Board of India (Sebi) chief Madhabi Puri Buch and her husband Dhaval Buch on Friday issued a joint statement amid allegations by US short-seller Hindenburg Research saying that she adhered to all disclosure and recusal guidelines set by the markets regulator.

"Madhabi has never dealt with any file involving Agora Advisory, Agora Partners, the Mahindra Group, timesofindia Pidilite, Dr Reddy’s, Alvarez and Marsal, Sembcorp, Visu Leasing or ICICI Bank at any stage after her joining Sebi," the statement read.

Terming the allegations "false, incorrect, malicious and motivated", the statement said that the allegations are "based on our Income Tax Returns" which "clearly have been obtained by adopting fraudulent means and illegally".

The Buchs said it was "a clear breach of not only our right to privacy (which is a fundamental right) but also a violation of the Income Tax Act. The facts, transparently reflected in our income tax returns, have been twisted deliberately to create a false narrative."

In the statement, it has been claimed that after Dhaval's retirement, "he undertook his consulting practice under the two companies Agora Advisory and Agora" and that his assignments were undertaken "under company structure" to ensure transparency by isolating income generated and report accruals and assignment-related expenses.

"It is unfortunate that a process that actually facilitates greater transparency is being sought to be projected as suspicious", the duo said in a statement.

The duo also issued a clarification on the rental income they received from a property that was leased out -- where the lessee happened to be an associate of Wokhardt, a listed company which had come under probe.

On rental income
In the joint statement, it has been claimed that "Madhabi has not dealt with any files related to Wockhardt".

"Given the all-India remit of SEBI's responsibilities, which encompass hundreds of investigations, thousands of surveillance alerts, hundreds of approvals, and hundreds of orders annually, the Chairperson is usually not even aware of specific cases, as they are handled in the normal course by other designated officials as per Delegation of Powers which have always been in place," the statement read.

They said that the "rental agreement for the property in question was concluded in
accordance with standard market practices and this property jointly owned by Madhabi
and Dhaval is leased and the rental from the same is declared and tax paid accordingly".

The couple has said that "even an allegation of conflict is not only defamatory, false and vexatious, but is clearly malicious and motivated".

On ICICI ESOPs

On charges linked to ICICI ESOPs that it can only be exercise in three months, the statement said "the provisions of ICICI Bank's ESOP scheme were different for resigning and retiring employees".

The statement said that Madhabi, like other senior employees, received ESOPs during her tenure and that only employees "who resigned were required to exercise their vested options within three months".

On pension amounts drawn

Replying to the allegations concerning uneven nature of pension amounts with gaps in between, the duo said "pension payments were consistent" and that they were part of "a contributory Annuity Scheme from ICICI Prudential".

"The uneven amounts related to exercise of ESOPS at various stages over the ten years. Depending on when Madhabi exercised her options and the prevailing market prices at the relevant time and the quantity of ESOPs exercised, the perquisite value is bound to vary each year," the statement read.

"If no ESOPs were exercised in a given year, there would be zero value attached to it and this would be bound to be reflected in the returns as a gap year. This perquisite value is required to be filed under the "Salary" category both by ICICI Bank and by the ex-employee. This is a clear law of the land," they added.