BHEL Slapped with ₹5.42 Lakh Fine by BSE and NSE Over Board Composition Norms
New Delhi, March 3, 2026: Bharat Heavy Electricals Limited (BHEL), one of India's largest engineering and manufacturing PSUs, has been penalized by the country's leading stock exchanges for failing to maintain the required composition of its Board of Directors.
In a regulatory filing on Monday, the company disclosed that it has received separate notices from both BSE Ltd. and the National Stock Exchange of India Ltd. (NSE), each imposing a fine of ₹5,42,800 (inclusive of GST) .
The Reason for the Fine
The penalties have been levied for non-compliance with Regulation 17(1) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 for the quarter ending December 2025.
According to SEBI norms, the board of directors of a listed company must have an optimum combination of executive and non-executive directors, with at least 50% of the board comprising Independent Directors. BHEL informed the exchanges that its composition fell short of this requirement during the said quarter, as the number of Independent Directors was less than 50% of the actual strength of the Board.
BHEL’s Response and Rationale
In the disclosure signed by Company Secretary Dr. Yogesh R Chhabra, BHEL clarified that it is a Government of India Undertaking, and the appointment of Directors—including Independent Directors—falls under the purview of the Government of India.
The company stated that it is "regularly taking up with the Government of India for appointment of requisite number of Independent Directors" to ensure compliance with the regulations.
Seeking a Waiver
Leveraging the provisions of the Standard Operating Procedure (SOP) Circular issued by the stock exchanges, BHEL has confirmed that it is proposing to seek a waiver of the fines levied.
This situation highlights a recurring challenge for many Central Public Sector Enterprises (CPSEs) listed on stock exchanges, where the appointing authority (the government) operates on a different timeline compared to the strict corporate governance deadlines mandated by SEBI.
About BHEL: BHEL is one of India's premier engineering and manufacturing enterprises, operating under the administrative control of the Ministry of Heavy Industries & Public Enterprises.