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The Centre has refrained from specifying a timeline by when the proposed merger of National Spot Exchange Ltd (NSEL) with Financial Technologies India Ltd (FTIL) would be completed, stating that the matter was "sub judice" at present.
In a written reply to a Lok Sabha question, the Corporate Affairs Minister Arun Jaitley has said FTIL had filed a writ petition before the Bombay High Court, challenging the constitutional validity of Section 396 of the Companies Act 1956 and praying for the quashing of the draft merger order.
In October last year, the Corporate Affairs Ministry ( MCA) had issued a draft order under Section 396 for the amalgamation of scam-hit NSEL with FTIL.
This draft order was seen as one of its kind, as this was the first instance involving two private sector companies.
Prior to this order, only in four cases — in the last three decades — has the Centre invoked Section 396 in the public interest.
Meanwhile, the Corporate Affairs Ministry is expected to this week hand over to FTIL a copy each of certain documents based on which the merger of NSEL with FTIL was proposed.
The Bombay High Court has also directed FTIL to file its representation within 10 days after receiving the documents from the Government.
Thereafter, the Government will hear all the affected parties within two weeks.
At the request of the Government, the Bombay High Court had extended the deadline to pass the final order to October 31.
With thousands of shareholders, creditors and stakeholders having written to MCA opposing the merger, the Ministry is in a bind about reviewing and processing the same for deciding on the final order, sources said.
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