Even as Sebi WTM, Madhabi Puri Buch drew 'salary' from ICICI Bank: Cong

No payment to her other than retiral benefits, clarifies lender

The Opposition Congress on Monday alleged that Securities and Exchange Board of India (Sebi) chairperson Madhabi Puri Buch continued to “draw salary” from her previous employer ICICI Bank despite being appointed a whole-time member (WTM) of the market regulator. ICICI Bank has dismissed these allegations.

 

Addressing a press conference, the Congress’ media and publicity department head, Pawan Khera, alleged that Buch earned Rs 16.8 crore from the ICICI group while being an official at the market regulator and raised potential conflict of interest.

 

Speaking at a session by CII in Mumbai on Monday, Buch,did not respond to questions on the fresh allegations. However, in her address she said, “Even if I talk about Reits (real estate investment trusts), I am  accused of having a conflict of interest.”

 

 

ICICI Bank, however, refuted the claims, saying Buch was not paid any salary or granted any employee stock ownership plan (Esops) after her retirement in October 2013. In a stock exchange filing, the private sector lender said all payments made to Buch after 2013 had accrued during her employment period. It further said that the bank hasn’t paid her anything other than “retiral” benefits occurring out of grant of Esops. 

 

“ICICI Bank or its group companies have not paid any salary or granted any ESOPs to Madhabi Puri Buch after her retirement, other than her retiral benefits. It may be noted that she had opted for superannuation with effect from October 31, 2013,” ICICI Bank said in a statement. The bank said its employees had the choice to exercise their ESOPs anytime up to a period of 10 years from the date of vesting.

 

Buch took charge as Sebi chairperson in March 2022; she is the first chairperson from the private sector. Before that she was a Sebi whole-time member between April 2017 and October 2021. Prior to joining Sebi, she was associated with ICICI Bank and its group firms for nearly two decades. Buch is also the first chairperson from the private sector.

 

The Opposition party alleged that Buch held an “office of profit” at ICICI Bank while being an official at Sebi.

 

Khera sought an explanation from Buch and Prime Minister Narendra Modi, who is involved in selecting the Sebi chief. His allegations were later backed by Congress President Mallikarjun Kharge, who demanded Buch’s immediate dismissal as Sebi chairperson, and said the Supreme Court should take cognizance of these “fresh revelations”.

 

Between 2021-2023, the current Sebi chairperson was also in receipt of TDS (tax deducted at source) on the ESOP that was paid by ICICI Bank amounting to Rs 1.10 crore, Khera said. “This is a case of escapement of income tax...This tax escape is Rs 50 lakh.”

 

On income-tax-related allegations, ICICI Bank said: “As per income tax rules, the difference between the price of the stock on the day of exercise and the allotment price is treated as perquisite income and is reflected in Part B of the Form16 of employees, including retired employees. The bank is required to deduct the perquisite tax on this income. In addition, Form-16 covers the payment made towards the retiral benefits of former employees.”

 

Citing a news article, Khera alleged Buch “changed regulations” to favour the ICICI group and facilitated easier delisting of its broking arm ICICI Securities as a “favour.”

 

The Congress also alleged that Sebi chair continued to pass judgments and was involved in matters concerning the ICICI group while “earning income from the group”.

 

Last month, the New-York based short-seller Hindenburg Research had questioned Buch’s objectivity in probing the Adani group, alleging that she held stake in offshore entities used to siphon off funds and manipulate stock prices. Hindenburg had also red-flagged the income generated by Buch’s and her husband’s consultancy firm Agora Advisory.

 

It had also alleged that Buch had a conflict of interest with Blackstone as her husband Dhaval Buch was appointed as an advisor to the global asset management company, which is a major investor in REITs.

 

The Buchs had issued statements refuting all the allegations. She added that they had made disclosures and had included connected firms in her recusal list.

 

In a statement issued post the Hindenburg allegations, the duo had said that during their long corporate careers they “have accrued their savings through their salaries, bonuses and stock options. Insinuations about net worth and investments referencing Madhabi’s current government salary are malicious and motivated.”