G N Bajpai resigns from IL&FS board

MUMBAI: G N Bajpai, a former chairman of markets regulator Sebi and a board member of the now defunct Kingfisher Airlines, resigned from the board of debt-laden IL&FS — the government-owned infrastructure financing company that has created a major crisis in the country’s debt market by multiple defaults.

On October 3, the government had set up a seven-member team to replace the earlier board of IL&FS with Bajpai as one of its members and chaired by noted banker Uday Kotak. However, soon after Bajpai’s appointment, proxy advisory firms had red-flagged the government’s decision citing conflict of interest during his association with Kingfisher Airlines.

On October 4, TOI had reported that in addition to the Vijay Mallya-promoted Kingfisher Airlines, Bajpai was also associated with MCX-SX (now Metropolitan Stock Exchange) — a sister concern of defunct National Spot Exchange (NSEL) that is also being investigated by agencies.

The government’s Serious Fraud Investigation Office (SFIO) had looked into alleged financial irregularities in Kingfisher Airlines, on which Bajpai was an independent director. His appointment to the IL&FS board, despite his association with the two entities that were investigated, raised several eyebrows.

Bajpai’s resignation will be effective from October 30, a release from IL&FS said. There are six members remaining on the IL&FS board. Along with Kotak, there are ICICI Bank chairman G C Chaturvedi, IAS officer and director general of shipping Malini Shankar, Vineet Nayyar of Mahindra group, veteran auditor Nandkishore, and former chief secretary of Rajasthan C S Rajan.

In an unrelated development, IL&FS Transportation said on Thursday it had defaulted on interest payment worth Rs 2.3 crore on non-convertible debentures. It also said Neeru Singh, an independent director, had resigned from its board.