“The pending enforcement proceedings for alleged defaults…are settled qua the applicant,” the regulator in a settlement order said, adding that it will not initiate enforcement action against the firm for the default.
SSFL is registered with the Reserve Bank of India (RBI) since April 2015. Pursuant to its initial public offer, its shares were listed on the BSE and NSE on August 2019.
& Co LLP was the then statutory auditor of the SSFL and had audited the company financials for a continuous period of eight years.
However, an RBI notification dated April 2021 restricted the tenure of a statutory auditor to a maximum of three years on a continuous basis, followed by its ineligibility to audit the same firm for the next six years.
The aforesaid notification was applicable to NBFCs from the second half of the financial year 2021-22. In accordance with the criteria prescribed, the then auditor of the SSFL was also required to resign as the statutory auditor from the second half of the financial year ending March 2022.
Before tendering its resignation, Batliboi was required to issue the limited review/ audit reports for the quarter ending September 2021, December 2021 and the last quarter of the financial year 2021-22, as well as submit the overall audit report for the FY 2021-22.
However, SSFL informed Sebi that Batliboi had resigned without issuing the limited review/audit reports for the aforesaid periods as they were ineligible to continue as statutory auditors.
In view of the same, it is alleged that the SSFL had failed to comply with the provisions of the Listing Obligations Disclosures Requirements (LODR).