Tata Capital Limited has paid a settlement amount of ₹32 lakh to the Securities and Exchange Board of India (SEBI) for violations related to Non-Convertible Debenture (NCD) issuances by erstwhile Tata Motors Finance Limited (TMFL), which merged with the company. The company disclosed this information to stock exchanges on December 23, in compliance with Regulations 30 and 51 of SEBI Listing Regulations.

Settlement Background and Merger Details

SEBI passed a settlement order regarding a suo-motu settlement application filed by erstwhile TMFL under the SEBI (Settlement Proceedings) Regulations, 2018. TMFL amalgamated with Tata Capital Limited following a scheme of arrangement sanctioned by the National Company Law Tribunal, Mumbai.

Nature of Violations

The settlement pertains to violations of applicable provisions of the Companies Act, 2013, SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021, and SEBI (Issue and Listing of Debt Securities) Regulations, 2008. The violations occurred across five instances of NCD issuances on private placement basis during 2019, 2020, and 2021.

The NCDs were downsold to more than 200 investors either prior to the listing date (in case of two listed NCD issuances) or within six months from the allotment date (for three unlisted NCD issuances). This downselling pattern caused the issuances to be deemed as public issues, violating the regulatory framework.

Financial Settlement

Tata Capital Limited has already paid the settlement amount to SEBI and provided details of the financial implications:

Regulatory Compliance

The company had previously disclosed details of the settlement application in the offer documents filed for its Initial Public Offering of equity shares. Under the settlement framework, TMFL proposed to settle without admitting or denying the findings of facts and conclusions of law regarding the enforcement proceedings that could have been initiated for the violations.

The disclosure was signed by Sonali Punekar, Authorized Signatory, who declared that the information provided is true, correct, and complete to the best of her knowledge and belief, in compliance with Regulation 30(13) of the SEBI Listing Regulations.

Tata Capital Limited received a disclosure from Tata Motors Passenger Vehicles Limited regarding the transfer of equity shares pursuant to a composite scheme of arrangement. The transaction, disclosed on December 22, 2025, involved the transfer of 43,26,651 equity shares representing 0.10% of Tata Capital's paid-up share capital.

Corporate Restructuring Implementation

The transfer was executed through a comprehensive composite scheme of arrangement involving Tata Motors Limited, TML Commercial Vehicles Limited, and Tata Motors Passenger Vehicles Limited. The scheme received approval from the National Company Law Tribunal, Mumbai Bench on August 25, 2025, with additional orders dated September 10, 2025.

Effective October 1, 2025, significant organizational changes were implemented as part of the restructuring. The commercial vehicle business of Tata Motors Limited was demerged and transferred to TML Commercial Vehicles Limited on a going concern basis.

Name Changes and Business Transfer

As part of the restructuring, strategic name changes were implemented effective October 1, 2025. Tata Motors Limited was renamed to Tata Motors Passenger Vehicles Limited, while TML Commercial Vehicles Limited was renamed to Tata Motors Limited.

The demerged commercial vehicle business, including all assets, liabilities, properties, permits, contracts, rights, and authorities, was transferred to the newly named Tata Motors Limited by operation of law. This transfer occurred in accordance with the sanctioned scheme of arrangement.

Share Transfer Mechanism

Consequently, the shareholding in Tata Capital Limited previously held by the original Tata Motors Limited (now Tata Motors Passenger Vehicles Limited) was transferred to TML Commercial Vehicles Limited (now Tata Motors Limited). This transfer occurred automatically under the terms of the approved scheme of arrangement.

The equity share capital of Tata Capital Limited comprises 4,32,66,510 equity shares of ₹10.00 each. The transferred shares represent a minority stake within the Tata Group's cross-holding structure.

Regulatory Compliance and Disclosure

The disclosure was made under Regulation 7(2) of SEBI (Prohibition of Insider Trading) Regulations, 2015. Tata Motors Passenger Vehicles Limited filed the intimation with both BSE Limited and National Stock Exchange of India Limited, providing details of ceasing to be a member of the promoter group for the specific shareholding.

The transaction represents the culmination of the Tata Group's strategic corporate restructuring initiative, designed to create focused business entities while maintaining appropriate cross-holdings within the group structure.