MUMBAI: Market regulator Sebi has ordered Embassy REIT’s manager to immediately sack its CEO Aravind Maiya for “harming ordinary investors” of Coffee Day and also appoint an interim CEO in his place.
This follows the findings by the National Financial Reporting Authority (NFRA) of serious lapses and gross negligence leading to market fraud by Maiya while leading the statutory auditors of Coffee Day Enterprises during FY19 as their engagement partner.
Embassy Office Parks Management Services is the manager of Embassy REIT, which is owned by the Embassy Group of Jitu Virwani, whose commercial tenants include IBM, Microsoft, Fidelity, TCS, Rolls Royce, Mercedes Benz, Yahoo, Goldman Sachs and Swiss Re. Embassy Office Parks REIT is the first listed REIT in the country and the largest office REIT in Asia by area.
In an interim order passed Monday, Sebi said Maiya was debarred for the maximum permissible period by the NFRA.
Sebi had passed an order on Coffee Day in January 2023, in which it noted that Rs 3,535 crore was transferred from Coffee Day’s subsidiaries to its related party, Mysore Amalgamated Coffee Estates, without obtaining the necessary approvals from the board of directors or the audit committee.
There were other violations too, such as the non-disclosure of material subsidiaries leading to glaring audit omissions, failure to maintain adequate internal controls over its finance functions, and failure to carry out adequate due diligence and exercise independent judgment, the Sebi order said.