Sebi has warned Tata Consultancy Services to be careful in dealing with disclosure of material information to investors after the watchdog found that the IT major did not prominently display the extent of damages related to a case in the US.
The regulator has also asked the company to ensure that disclosures provide adequate, accurate, explicit and timely information to the investors.
On April 16, 2016, TCS made a disclosure to the stock exchanges regarding a US court verdict related to an intellectual property rights case with Epic Systems.
According to Sebi, the disclosure indicated that TCS had received a jury verdict in lawsuit filed by Epic Systems in the court of Western District Madison, Wisconsin.
While the disclosure did not mention the $940 million penalty imposed against TCS as part of the verdict, the said amount was shown as part of contingent liabilities when the the company announced its financial results on April 18, 2016, according to Sebi.
In another disclosure made on October 1, 2017, TCS specifically mentioned that the court significantly reduced the compensatory and punitive damages of $940 million to $420