Cong after ICICI clarification on SEBI chief: ‘How can retiral benefits exceed salary?’

After ICICI Bank’s clarification on SEBI Chairperson Madhabi Puri Buch, Congress has raised more questions regarding her retiral income and a one-year gap in which it says no such benefit was offered. ICICI Bank on Monday clarified that all the payments made to Buch – comprising ESOPs and retiral benefits – post her retirement had accrued to her during her employment phase with the ICICI Group.

Congress spokesperson Pawan Khera, in a press conference today, asked how “her retirement or retiral benefits or pension could be more than the salary” she drew when she worked with ICICI Bank. "If we calculate the average salary of Madhabi Puri Buch from 2007-2008 to 2013-14 when she was with ICICI, it was around ₹1.30 crore. But the average pension is ₹2.77 crore. How is this possible?" he alleged.

He asked if it was a retirement or retiral or pension benefit, why was there a break in 2015-16 and why it was resumed in 20216-17 when she was appointed as SEBI’s whole-time member. "If a settlement had happened in 2014-15 between Buch and ICICI, and she did not receive anything from ICICI in 2015-16, why did it restart in 2016-17.”

Khera demanded that SEBI should come out clean on the issue. “Clarify, and respond to our charges. It's millions of investors in the country whose confidence should remain in these regulatory bodies, and it should not be shaken," he adds.

Khera says ICICI’s responses have helped the opposition party in “un-layering this expose” even further. He says when Buch retired from ICICI, she received a gratuity worth ₹71.90 lakh in 2013-14, while she received a commuted retirement pension worth ₹5.36 crore in FY2014-15. "Which job offers the pension or retiral benefits more than the salary?" he asked.

On ICICI's explanation of its employees and retired employees having the rights to exercise ESOPs, Khera says: "ICICI has written on an American website that if one resigns from ICICI Bank, ESOPs can be exercised within three months of the resignation. But Madhabi Buch ji is still earning ESOPs even after 8 years of resigning. Why does not every ICICI employee get this kind of benefit?"

He said “ICICI Bank paid TDS” on behalf of Buch. "Now the question is whether such a policy is applicable to all officers/employees of ICICI. If ICICI pays TDS on ESOP on behalf of Madhabi Puri Buch, should it not be counted as her income? If yes, tax should be paid so why did ICICI not show this TDS amount in taxable income?” he says, adding that it was a violation of the Income Tax Act.

Alleging irregularities, Congress on Monday said the SEBI chairperson Buch had been drawing regular salary between 2017 and 2024 worth ₹16.80 crore from ICICI Bank.

Responding to the Congress' allegations on Monday, ICICI had said ICICI Bank or its group companies did not any salary or ESOPs to Buch after her retirement, other than "retiral benefits". She opted for "superannuation" with effect from October 31, 2013, says ICICI, adding that during her employment with the ICICI Group, she received compensation in the form of salary, retiral benefits, bonus and ESOPs, in line with applicable policies.

"Under the Bank’s ESOP rules, the ESOPs vest over the next few years from the date of allotment. As per rules existing at the time of her ESOP grant, employees including retired employees had the choice to exercise their ESOPs anytime up to 10 years from the date of vesting," said ICICI Bank.

The bank also said that as per Income Tax rules, the difference between the price of the stock on the day of exercise and the allotment price was treated as perquisite income and is reflected in Part B of Form 16 of employees, including retired employees. "The Bank is required to deduct the perquisite tax on this income. In addition, Form -16 covers the payment made towards the retiral benefits of former employees."