Gitanjali Gems director, two executives resign; company secretary cites 'conscience' issues in letter

New Delhi: Gitanjali Gems, the company founded by Mehul Choksi, the maternal uncle of India's infamous diamond king Nirav Modi, is seeing a spate of resignations. After the company became the eye in the Rs 11,400 cr Punjab National Bank loot-and-scoot scam, its chief financial officer (CFO) Chandrakant Karkare threw in the towel citing personal reasons, company reported stock exchanges. Earlier, company secretary and compliance officer Pankhuri Warange also resigned, taking moral responsibility.

Representational image. Reuters.

Representational image. Reuters.

On Monday, Gitanjali Gems' director Krishnan Sangameswaran also resigned from the board, the company informed to stock exchanges.

Chandrakant Karkare (CFO) states a personal reason for the decision. "Recently my wife has undergone a major surgery called Hemicolectomy at Lilavati Hospital. The post operation recovery is not upto the expected level. This has resulted in restriction on me carrying responsibilities as CFO and will be very difficult for me in future," said Karkare.

Read Chandrakant Karkare's (CFO) resignation letter here.

Compliance officer and company secretary Pankhuri Warange has attributed her resignation to the ongoing fraud related investigation for her "conscious" decision.

Her resignation states, "Being a key managerial personnel and the designated compliance officer, I have certain statutory duties and responsibilities towards the stakeholders. The recent event unfolded in the organisation requires the company to make disclosures under the Companies Act 2013 and the SEBI requirements 2015. I have advised the management on the required disclosures to be made. The absence of disclosures will have ramification not just on the company but also on the key managerial personnel."

Read Pankhuri Warange resignation letter here.

Meanwhile, the shares of Gitanjali Gems continued to fall for the fourth straight session on Monday, plunging 10 percent as investor sentiment remained muted after the company came under the scanner of various investigating agencies following PNB's Rs 11,400-crore fraud detection.

The stock tumbled 9.99 percent to Rs 33.80 -- its lower circuit limit -- on BSE.

At NSE, shares of the company plunged 9.87 per cent to hit its lowest trading permissible limit of Rs 33.75.

In four trading sessions, the stock has lost over 46 percent, wiping out Rs 344 crore from its market valuation.

Among other jewellery stocks, Tribhovandas Bhimji Zaveri (TBZ) was trading lower by 3.80 percent, Thangamayil Jewellery 1.84 percent and PC Jeweller 1.42 percent on BSE.

On 14 February, Punjab National Bank (PNB) disclosed that it detected some fraudulent transactions with financial implication of about Rs 11,346 crore and the matter has been referred to law enforcement agencies for the recovery.

Four big jewellers -- Gitanjali, Ginni, Nakshatra and Nirav Modi -- are under scanner.

While billionaire jewellery designer Nirav Modi, the alleged perpetrator of this fraud, is not directly linked to any listed company, his relative and business associate Mehul Choksi's Gitanjali Gems is a listed firm and has been involved in some other cases of suspected market manipulations.

(With PTI inputs)


Updated Date: Feb 19, 2018 14:11 PM

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