All options, including superceding Board by CLB, on table, says Sachin Pilot

The Corporate Affairs Ministry is likely to consult the Finance Ministry before taking a call on the next course of action in the crisis-ridden National Spot Exchange Ltd (NSEL) matter.

An indication to this effect was given by Corporate Affairs Minister Sachin Pilot here on Friday.

All options, including approaching the Company Law Board to supercede the NSEL Board, are on the table, Pilot said. “The Forward Markets Commission report is already before us (Government). The final report (Mumbai RoC) is expected in the next couple of days. After that, we will consult the Finance Ministry and take necessary action”, Pilot said on the sidelines of an industry event here.

Finance Ministry now has a larger say in the handling of NSEL fiasco given that commodities futures regulator FMC is now part of this Ministry.

Pilot said the Ministry was keen to ensure a regulatory framework where investor interest was protected and scams such as NSEL do not recur.

INTERIM REPORT

After inspection of NSEL, the Registrar of Companies’ Mumbai had in its recent interim report found complete corporate governance failure in NSEL.

The report had highlighted 15 instances of company law violations besides the fact that Brand India has been tarnished by several irregularities.

The interim report had recommended that Corporate Affairs Ministry could approach the Company Law Board to seek supercession of the NSEL Board.

FMC REPORT

FMC had on Wednesday concluded that Jignesh Shah and Financial Technologies, a promoter of NSEL, were not “fit and proper” to run any exchange in the country. It also held that Shah was the highest beneficiary in the NSEL scam.

srivats.kr@thehindu.co.in

(This article was published on December 20, 2013)
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