BSE Ltd has levied a fine of ₹9,67,600 on Gujarat State Financial Corporation for non-compliance with corporate governance requirements during the quarter ended March 31, 2026. The penalty was communicated via an email dated May 27, 2026, which was opened by the corporation on May 29, 2026. The fine addresses violations of specific regulations under the SEBI (LODR) Regulations, 2015, including Regulations 17(1), 17(2A), 18(1), and 19(1)/19(2).

The regulatory action specifically cites the non-appointment of independent directors and issues regarding the quorum of meetings. Gujarat State Financial Corporation disclosed that it has not remitted the fine and has requested the exchange to reconsider the imposition of the penalty. The corporation argues that its board composition is governed by the State Financial Corporations Act, 1951, a statute that does not currently provide for the induction of independent directors.

Statutory Conflict and Compliance Efforts

Gujarat State Financial Corporation is a statutory body corporate established by the Government of Gujarat under the State Financial Corporations Act, 1951. The corporation stated that the composition of its Board of Directors is determined by Sections 10, 15, and 17 of this Act. Since the existing statute does not mandate independent directors, the corporation claims that complying with the SEBI requirement is inconsistent with its primary governing law.

Following advice from SEBI via a letter dated December 20, 2021, the corporation approached the appropriate authorities on December 27, 2021, to propose amendments to the State Financial Corporations Act. The objective of these proposed amendments is to align the act with the SEBI (LODR) Regulations. Until these legislative changes occur, the corporation asserts it is complying with corporate governance requirements to the extent possible within the framework of the 1951 Act.

Financial Impact and Waiver Request

The corporation has maintained that there is no impact on its financial, operational, or other activities as a result of the fine. It reiterated that the penalty has not been paid. Furthermore, Gujarat State Financial Corporation noted that Regulation 17(2A) of the SEBI (LODR) Regulations, 2015, which pertains to the composition of the board, is technically not applicable to it as it is not among the top 2000 companies. Despite repeated requests to waive the fine on this basis, the exchange has not granted the waiver.

Gujarat State Financial Corporation , established under the State Financial Corporations Act, 1951, has notified BSE Ltd of an upcoming Board of Directors meeting pursuant to Regulations 29(1)(a), 33, and other applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The meeting is scheduled to be held on Saturday, May 30, 2026, at Gandhinagar.

Key Agenda Items

The Board meeting has been convened to address several significant corporate matters. The following agenda items are scheduled for consideration:

Board Meeting Details

The intimation, dated May 19, 2026, was communicated to the Listing Department of BSE Ltd from Gujarat State Financial Corporation's Secretarial Cell, located at 1st Floor, Udyog Bhavan, Sector-II, GH-4, Gandhinagar – 382 010. The notice has also been made available on the Corporation's official website.

The primary purpose of the meeting is to consider and take on record the audited financial results for the quarter and year ended March 31, 2026. In addition, the Board will deliberate on recommending to members at the ensuing AGM the appointment of M/s. J.H. Mehta & Co., Chartered Accountants, Ahmedabad as statutory auditors of the Corporation for the Financial Year 2026-27. The Board will also decide the date and time for conducting the 66th Annual General Meeting of the Corporation.