SEBI finds IDBI Trusteeship Services misled on data updates during 2022–2024 inspection

This is an adjudication order by SEBI regarding IDBI Trusteeship Services Limited (ITSL) for alleged failures to take required actions, such as notifying investors and appointing directors, when issuer companies defaulted on their debentures.

Who it concerns: IDBI Trusteeship Services Limited (ITSL)

What SEBI found or ordered

• SEBI alleged ITSL failed to maintain proof of delivery for these notices.
• SEBI alleged ITSL failed to include mandatory clauses (such as consent provisions) in notices sent to debenture holders.
• SEBI alleged ITSL failed to update default history on the India BondInfo database within 7 days for ATS Infrabuild Pvt. Ltd. and Future Supply Chain Solutions Ltd.
• SEBI alleged ITSL submitted false information to SEBI during inspection regarding the timeliness of database updates.
• SEBI alleged ITSL failed to appoint nominee directors on the boards of the five mentioned issuer companies as required by regulations.
• SEBI alleged ITSL failed to convene meetings of debenture holders within 30 days of default for Jharkhand Road Projects Implementation Company Ltd and Century Sheltors Developers Pvt. Ltd.
• The order cites violations of the SEBI (Debenture Trustees) Regulations, 1993, and various SEBI circulars and Master Circulars.

Also in the document

• The inspection period covered July 31, 2022, to July 31, 2024.
• SEBI specifically noted that ITSL claimed automatic overwriting of old data ensured compliance, which SEBI found to be misleading as updates were not made within prescribed timelines.
• The order is an adjudication proceeding initiated after a thematic inspection; the text provided contains the allegations and the noticee's reply but does not contain the final penalty decision.