Mohan India, one of the largest debtors of National Spot Exchange Ltd, has agreed to pay Rs 771 crore over one year as part of its settlement obligation. The company will make a down payment of Rs 11 crore and pay the balance over the next one year.

Promoted by Financial Technologies, the exchange which suspended trading on August 1, had announced a weekly settlement of outstanding trades worth about Rs 5,600 crore. However, it has defaulted on this commitment continuously for the last 11 weeks.

The Economic Offences Wing of Mumbai police have arrested three officials of the exchange, including its Managing Director and the chief of NK Proteins, the largest defaulter with a payment obligation of Rs 970 crore.

Mohan India is the first defaulter who has agreed to pay within a stipulated time. The company has put up as security its 500 acres of land near Bikaner in Rajasthan and a 14,000 sq yard bungalow in New Delhi, said a source.

Of the Rs 5,600 crore outstanding settlement, top six defaulters alone account for Rs 4,200 crore.

The EOW has already invoked the Maharashtra Protection of Interest of Depositors Act that has provisions to attach properties of defaulters.

Recovery process

Further, the EOW has started to identify properties of the defaulters and exchange officials that may be sold to recover investors’ money.

Saji Cherian, Managing Director and CEO of the Exchange, said the efforts of the new team at NSEL and the Investors’ Forum over the last few weeks are expected to show some positive results. “Some of the big members who have pay-in obligations are co-operating… Some more members have come forward to settle their dues and these are at various stages of finalisation,” he said.

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