Gautam Adani-promoted Adani Gas is said to have received show-cause notices for an alleged breach of regulations in the bidding process for city gas distribution projects, sources with direct knowledge of the development told CNBC Awaaz’s Yatin Mota.
“PNGRB has sent show-cause notices to Adani Gas for non-disclosure of information and pointed out violation of law while bidding for city gas distribution projects,” said one of the sources on condition of anonymity.
The show-cause notices accessed by CNBC Awaaz revealed that Adani Gas bid for Gas projects using networth calculations of Adani Enterprises without disclosing the scheme of arrangement between the two companies.
Adani Gas was later demerged as a part of the restructuring between Adani Enterprises, its holding company. However, PNGRB believes that this was in violation of law as Adani Gas’ shareholding changes and restructuring were not in compliance with CGD regulations.
PNGRB in the show cause notices also seeks to cancel licences of Adani Gas and levy a penalty of about Rs 400 crores.
One of the sources also added that the regulator is yet to approve Adani Gas’ deal to sell a 37.4 percent stake to Total SA since the regulations do not allow shareholding of the current promoters to dip below the 51 percent threshold.
Commenting on the story, a company spokesperson said, “We are fully compliant and have transparently represented facts in totality adhering to norms of compliance and disclosure.”