IndiGo promoter Rakesh Gangwal has written a letter to markets regulator Sebi flagging governance issues at the company and has accused fellow co-founder Rahul Bhatia and his firms of indulging in questionable related-party transactions.
Locked in a bitter battle with fellow co-founder Rahul Bhatia, IndiGo promoter Rakesh Gangwal has alleged serious governance lapses at the company, saying even a "paan ki dukaan" (betel shop) would have managed matters with more grace.
Gangwal, who along with his affiliates holds around 37 per cent stake in InterGlobe Aviation, said that the company has "started veering off" from the core principles and values of governance that made the company what it is today.
InterGlobe Aviation (or IndiGo) is also the parent of the country's largest airline IndiGo.
Co-founder Rahul Bhatia and his affiliates (IGE Group) has around 38 per cent stake.
Gangwal has written a letter to markets regulator Sebi flagging governance issues at the company and has accused Bhatia and his firms of indulging in questionable related-party transactions.
According to him, the shareholders' agreement provides his long-time friend Bhatia unusual controlling rights over IndiGo.
"Beyond just questionable Related Party Transactions, various fundamental governance norms and laws are not being adhered to and this is inevitably going to lead to unfortunate outcomes, unless effective measures are taken today," Gangwal said in the letter.
Referring to various events at the company, Gangwal, in the proposed notice for extraordinary general meeting, said the events go "far beyond just poor governance and even a 'paan ki dukaan' would have handled these matters with more grace".
A copy of the letter has also been sent to Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman, Civil Aviation Minister Hardeep Singh Puri and Commerce Minister Piyush Goyal among others.
After Gangwal wrote to the board seeking an extraordinary general meeting, Bhatia, on June 12, opposed the proposal.
Bhatia wrote to the board alleging that the genesis of Gangwals' angst was his "hurt ego" and refusal of IGE Group to entertain his "unreasonable demands".
Photograph: Vivek Prakash/Reuters