Government to set up special court for NSEL cases

The government has decided to set up a special court to hear all cases related to the National Spot Exchange Ltd (NSEL) on a priority basis. It has also asked the Enforcement Directorate (ED) to expedite action to recover ~3,721 crore from defaulters, and the Securities and Exchange Board of India (Sebi) to complete the probe on brokers at the earliest.

Besides, the Ministry of Corporate Affairs (MCA) has been directed to pursue the court case expeditiously for effecting the merger of the now-defunct NSEL with its parent Financial Technologies (FTIL) at the earliest.

These decisions were taken at a recent meeting under the chairmanship of Economic Affairs Secretary Shaktikanta Das that reviewed the action taken by multiple investigating agencies on the ~5,600crore NSEL payment scam.

An official statement released on Sunday said: “Meanwhile, efforts are being made to set up an independent court to hear NSEL-related cases on an exclusive basis.” That apart, the government has asked the Economic Offences Wing (EOW) of Mumbai Police to “expedite realisation of value of attached assets, as per the procedure, quickly”.

So far, the EOW has attached 831 properties worth ~7,063 crore under the Maharashtra Protection of Interest Of Depositors Act, of which, attachments of 711 properties worth ~6,115 crore have been notified in the state Gazette.

“The government of Maharashtra was requested to expedite these measures so that the defaulters could be brought to book quickly; money could be realised from the sale of attached assets and consequently be returned to investors of NSEL, who have suffered losses in the payment crisis,” it added.

The payment crisis at NSEL came to light in 2013. Since then, the matter has come under the scanner of multiple agencies. The ED has arrested FTIL promoter Jignesh Shah, who has been remanded to judicial custody till August 1, 2016.

On the NSEL-FTIL merger case, the government said: “In the review meeting, MCA was advised to pursue the case expeditiously for effecting the merger at the earliest.”

“Further, MCA was also advised to strongly defend the efforts of the government to introduce management and governance changes in FTIL, which are under legal challenge in National Company Law Tribunal and the Madras High Court.”

Reviewing the actions taken by Sebi in the NSEL matter, the government said it conducted a detailed inspection of books of five brokers of the erstwhile Forward Markets Commission, whose names figure in the list of offenders received from the EOW.

The payment crisis at NSEL came to light in 2013. Since then, the matter has come under the scanner of multiple agencies