Comments
The Bombay High Court has asked the commodity regulator Forward Markets Commission (FMC) and the Economic Offences Wing to inspect all transactions carried out by National Spot Exchange Ltd (NSEL) and its subsidiary Indian Bullion Merchants Association Ltd (IBMA) under the e-series and paired contracts.
In an interim order, Justices S. J. Vazifdar and K. R. Shriram, also directed the spot exchange to send all the settlement requests to FMC and EOW for approval. They also directed EOW to inspect all the payment records and to create a separate designated account for financial settlements. NSEL was supposed to start financial settlement of the e-series gold and silver contracts on October 3.
The High Court has also asked the FMC and EOW to submit an action taken report against NSEL, its associates and its directors by October 18. The court will now hear the case on October 21.
The court is hearing the matter following a writ petition filed by two aggrieved investors — Tarun Amarchand Jain HUF and Ketan Shah HUF — against the spot exchange. The exchange has to settle dues worth Rs 5,574.31 crore in the non e-series segment to about 33,000 investors after it suspended trading abruptly from August 1.
The court said that the two investors can raise any objections against the transactions within two days of inspection, after which the FMC will investigate the transactions and take a decision within four days.
The investors have asked the court to impose a stay on settlement of gold and silver e-series contracts of the exchange. Besides, they have asked the FMC to verify the authenticity of gold and silver stocks under the e-series and to investigate whether the purchases were done using investors’ money. They wanted the exchange to restrain NSEL from making any ad-hoc payments to preferred e-series investors as it would further delay the e-series financial settlement.
The petitioners have sought a court-monitored time-bound investigation into the entire NSEL scam in order to safeguard investor interest.
> priyanka.pani@thehindu.co.in
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.