IRFC has issued a formal response regarding non-compliance penalties levied by the National Stock Exchange (NSE) and BSE for the quarter ended December 31, 2025. The Board noted the lapses concerning the composition of the Board and the required committees. The company has requested the Ministry of Railways (MOR) to expedite the appointment of necessary Independent Directors, stressing that director appointments are beyond IRFC’s control. A waiver request has also been submitted to the exchanges, citing precedent where similar fines were previously waived.
IRFC Formal Response to Exchange Penalties
Indian Railway Finance Corporation Ltd (IRFC) has submitted its official comments to the stock exchanges concerning non-compliance penalties imposed for the quarter ending December 31, 2025. This action follows receipt of communications from the NSE and BSE dated February 27, 2026, detailing the financial penalties.
Details of Non-Compliance and Fines
The non-compliance specifically related to the composition of the Board and the constitution of mandatory committees, namely the Audit Committee and the Nomination and Remuneration Committee, as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The total base fine imposed amounted to ₹8,28,000, escalating to a total payable amount of ₹9,77,040 inclusive of GST.
- Regulation 17(1) (Board Composition, including failure to appoint a woman director) incurred a total fine of ₹4,60,000.
- Regulations 18(1) (Audit Committee) and 19(1)/19(2) (Nomination and Remuneration Committee) each resulted in a fine of ₹2,17,120.
The penalty computation was based on 92 days of non-compliance across these regulations.
Board Action and Waiver Request
The Board deliberated on the matter during its meeting on March 09, 2026. Key actions decided were:
- Following up with the appointing authority, the Ministry of Railways (MOR), to expedite the appointment of the required number of Independent Directors.
- Noting that the appointment process is beyond the control of the Company, the Board requested the stock exchanges to waive the imposed fine.
- The company referenced earlier instances where NSE & BSE had waived similar fines for the period from March 2021 to December 2021 on the same grounds.
Context of Government Company Status
IRFC emphasized that as a Government Company, the power to appoint Directors rests solely with the President of India, exercised through the administrative Ministry of Railways (MoR). Consequently, the Company has no direct control over the timing or process of Director appointments to its Board.
Exchange Notification Summary (NSE & BSE)
Both exchanges notified IRFC of the impending fines based on the SEBI Master Circular dated November 11, 2024. The exchanges mandated compliance and payment within 15 days of receiving the notice. For the NSE, the fine breakdown included penalties for Regulation 17(1), 18(1), and 19(1)/19(2). The BSE notification included a broader set of non-compliances, detailing specific daily rates ranging from ₹2,000 to ₹10,000 per day/instance.
The filing date for this board comment is March 27, 2026, submitted by Mr. Vijay Babulal Shirode, Company Secretary & Compliance Officer.
Source: BSE
