Two-and-a-half months after Infosys submitted an application to SEBI to resolve its former CFO Rajiv Bansal’s severance pay issue, the software major has filed a counter-suit for ₹100 crore, alleging that he did not fulfil his obligations and breached trust.
While an Infosys spokesperson said: “We have no comments to offer,” industry watchers BusinessLine spoke to felt that this counter-suit could be an exercise to either delay the settlement or settle it out-of-court.
The issue pertains to the severance pay, of ₹17.38 crore, Rajiv Bansal was eligible for after he stepped down in December 2015.
While Infosys paid ₹5 crore, it held back the remaining amount after Infosys co-founder NR Narayana Murthy termed the compensation “excessive” and alleged that the management had paid Bansal “hush money”.
Infosys then said the agreement with Bansal provided for non-compete obligations, as also other rights and obligations. “Certain payments to Rajiv under the agreement have been suspended pending certain clarifications with regard to such rights and obligations,” it had said in a statement.
The Infosys board and its then CEO, Vishal Sikka, admitted that there was an element of subjectivity involving the quantum of the severance pay to Bansal but said that since then, it has made changes to the company policies to ensure that such a thing doesn’t happen again.
The issue reared its head again after Sikka quit the company, in August 2017. In December, Infosys filed for a “settlement application” with SEBI, to neither admit nor deny the findings of any probe.
A “settlement application” is a process by which companies settle matters.
This “settlement application” was in response to a whistleblower writing an e-mail to SEBI, pointing out that the company had flouted corporate governance norms. The complaint alleged thati Infosys had not sought prior and separate approval of the Nomination and Remuneration Committee, or ofi the audit committee regarding stopping of payments and initiating arbitration under the severance agreement.
Riled over the stick payments, Bansal moved the court against Infosys, demanding that his remaining dues be paid.
New strategy
This latest round of counter-suit from Infosys, according to industry watchers, is a tactic used to delay the settlement process. “If the plea was filed with SEBI, why has the company taken so long to file a a counter-suit,” said a corporate lawyer who spoke on conditions of anonymity.