New Delhi, Dec 23 (UNI) The Securities and Exchange Board of India (SEBI) has settled regulatory proceedings with Tata Motors Finance Limited (TMFL) over alleged violations related to the issuance of non-convertible debentures (NCDs), after the company agreed to pay a settlement amount of Rs 32 lakh.
The settlement brings closure to enforcement actions that could have been initiated under multiple provisions of the Companies Act and SEBI’s debt listing regulations.
The matter relates to five issuances of Tier II perpetual non-convertible debentures undertaken by Tata Motors Finance between 2019 and 2022 through private placement.
According to SEBI, these NCDs were subsequently down-sold to more than 200 investors within six months of allotment, triggering regulatory thresholds that deem such issuances as public issues under existing securities laws.
SEBI observed that the down-selling resulted in violations of provisions under the Companies Act, 2013, along with regulations governing the issuance and listing of non-convertible securities and debt securities.
These regulations are designed to ensure transparency, investor protection, and compliance when securities are offered to a broad base of investors.
In response, Tata Motors Finance filed a suo motu settlement application with SEBI under the Settlement Proceedings Regulations, proposing to resolve the matter without admitting or denying the findings of fact or conclusions of law.
The settlement application was reviewed through SEBI’s multi-tiered internal process.
An internal committee of SEBI examined the case and held discussions with authorised representatives of the company in June 2025. Following these deliberations, Tata Motors Finance submitted revised settlement terms, offering to pay ₹32 lakh to resolve the alleged violations.
The proposal was subsequently reviewed by SEBI’s High Powered Advisory Committee, which recommended acceptance of the settlement. The recommendation was then placed before a panel of SEBI’s Whole Time Members, who approved the settlement in October 2025.
SEBI issued a formal demand notice in November, and the company confirmed payment shortly thereafter.
With the settlement amount credited, SEBI has ordered that no enforcement action will be initiated against Tata Motors Finance for the violations cited in the case.
However, the regulator clarified that the settlement does not bar SEBI from reopening the matter if any representations made during the settlement process are later found to be untrue, if settlement conditions are breached, or if any payment discrepancies are discovered.
The settlement order came into effect immediately and marks the conclusion of the proceedings related to these NCD issuances. The case underscores SEBI’s continued focus on monitoring private placements and ensuring that issuers comply with disclosure and investor threshold norms, particularly in the debt markets where retail exposure has been increasing.
For the broader market, the order serves as a reminder that private placements which effectively reach a large number of investors may be reclassified as public issues, attracting stricter regulatory requirements.
It also highlights the regulator’s preference for timely resolution through settlement mechanisms while maintaining oversight and enforcement safeguards.
SEBI settles regulatory case with Tata Motors Finance over NCD issuances
