Details of Show Cause Notices

ESL received five separate Show Cause Notices alleging non-compliance with various provisions of the Companies Act, 2013:

1. SCN No. SCN/ADJ/07-2026/RN/05346 (Date: July 29, 2026)

  • Section: 203(5) of Companies Act, 2013
  • Financial Year: 2020-21
  • Allegation: Appointment of Key Managerial Personnel (CFO) without remuneration details in Board resolution
  • Proposed Penalty: ₹5,00,000 on ESL + ₹5,00,000 on each individual

2. SCN No. SCN/ADJ/07-2026/RN/05040 (Date: July 21, 2026)

  • Section: 178(8) of Companies Act, 2013
  • Financial Year: 2020-21
  • Allegation: Composition of Nomination & Remuneration Committee
  • Proposed Penalty: ₹5,00,000 on ESL + ₹1,00,000 on each individual

3. SCN No. SCN/ADJ/07-2026/RN/05161 (Date: July 21, 2026)

  • Section: 196 read with Schedule V (Penalty under Section 450)
  • Financial Year: 2019-20
  • Allegation: Failure to comply with Schedule V prescriptions for approval of Whole-time Director remuneration in AGM notice
  • Proposed Penalty: ₹2,00,000 on ESL + ₹50,000 on each individual

4. SCN No. SCN/ADJ/07-2026/RN/05183 (Date: July 21, 2026)

  • Section: 197(15) of Companies Act, 2013
  • Financial Years: 2015-16 to 2017-18
  • Allegation: Non-disclosure under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 regarding directors' remuneration in Board's Report
  • Proposed Penalty: ₹5,00,000 on ESL + ₹1,00,000 on each individual

5. SCN No. SCN/ADJ/07-2026/RN/05185 (Date: July 21, 2026)

  • Section: 197(15) of Companies Act, 2013
  • Financial Years: 2015-16 to 2017-18
  • Allegation: Non-disclosure under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 regarding employees' remuneration in Board's Report
  • Proposed Penalty: ₹5,00,000 on ESL + ₹1,00,000 on each individual

Total Proposed Penalties

  • On ESL Steel Limited: ₹17,50,000 (₹17.5 lakh)
  • On individuals: ₹13,50,000 (₹13.5 lakh) across all notices

Current Status and Impact

ESL is examining the matters and shall submit appropriate responses before the adjudicating authority within prescribed timelines. The company states this shall not have any significant financial and operational impact on Vedanta Iron And Steel Limited.