HUDCO fined ₹5.31 lakh for board composition non-compliance
Housing and Urban Development Corporation Limited was fined ₹531,000 by NSE and BSE for non-compliance with board composition norms in Q4FY26. The company attributes the non-compliance to delays in director appointments by the Government and has requested a waiver of the penalty.
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Housing and Urban Development Corporation Limited has been fined a total of ₹531,000 by the National Stock Exchange of India (NSE) and BSE Limited for non-compliance with board composition provisions during the quarter ended March 31, 2026. The penalty, which includes a basic fine of ₹450,000 and GST of ₹81,000, was levied under Regulation 17(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company stated that the power to appoint directors vests with the President of India, exercised through the Administrative Ministry, and has requested the exchanges to waive the fines as the appointments are beyond its control.
Details of the Penalty
The exchanges issued notices on May 27, 2026, following a verification of records which revealed non-compliance with the regulations regarding the composition of the Board of Directors. The fine was calculated at ₹5,000 per day for 90 days of non-compliance. The company has been advised to pay the amount within 15 days of receiving the notice to avoid further action, including the freezing of promoter shareholdings.
| Regulation | Quarter | Fine Amount (Rs.) | GST @ 18% (Rs.) | Total Payable (Rs.) |
|---|---|---|---|---|
| Regulation 17(1) | Mar-26 | 450,000 | 81,000 | 531,000 |
Board Response and Waiver Request
In its response to the exchanges, Housing and Urban Development Corporation Limited noted that it is a Government Company and had already requested the appointment of requisite Independent Directors from the concerned Ministry. The Board has directed continuous follow-up with the Ministry to apprise them of the penalties being levied. Consequently, the Board has formally requested the stock exchanges to waive the fines, arguing that the delay in director appointments is not within the company's control.
Compliance and Regulatory References
The notices referenced the SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026, issued on July 11, 2023, and last updated on January 30, 2026. This circular outlines the Standard Operating Procedure for imposing fines and suspension of trading in case of non-compliance. The exchanges have also mandated that the non-compliance and subsequent actions be placed before the Board, with the Board's comments duly informed to the exchanges for dissemination.
Historical Stock Returns for HUDCO
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -1.10% | -0.58% | -3.28% | -5.86% | -13.15% | +282.38% |
How will the exchanges respond to HUDCO's request for a waiver given the government's role in director appointments?
What impact could the potential freezing of promoter shareholdings have on HUDCO's stock liquidity if the fine is not paid?
Will the Ministry expedite the appointment of Independent Directors to prevent further daily penalties?
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