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Jignesh Shah-promoted 63 moons (formerly Financial Technologies) will move the Bombay High Court on Thursday against the Economic Offences Wing of Mumbai’s decision to freeze its operating account, jeopardising its operations.
Over 500 employees of the company held a peaceful protest in Mumbai and submitted a letter to the Chief Minister of Maharashtra and Commissioner of Police urging the investigating agency to target the defaulters rather than the company which provided the trading platform.
In 2013, National Spot Exchange, the subsidiary of Financial Technologies, failed to settle trades worth ₹5,600 crore on the exchange platform. Various investigative agencies are probing the matter amid a slew of cases filed in court.
The sudden flow of ₹600 crore into the operational account of 63 moons from pre-mature redemption of its investment in Basel-II bonds last week has triggered the EoW to freeze the account.
S Rajendran, Managing Director and Chief Executive Officer, 63 moons, said the redemption was done as per RBI’s directive to all NPA-laden banks under Prompt Corrective Action to redeem all Basel-II bonds as they carry high interest rate of 9-11 per cent.
“The bonds are supposed to mature between 2022 and 2024, but even without our instruction some of the banks have redeemed them. We will receive another ₹300 crore in the next few days. Of the ₹1,860 crore deposits in bonds, about ₹1,200 crore are invested in Basel bonds,” he said.
In an earlier notification dated September 21, 2016, the government had “clearly mentioned attachment of all fixed assets and investments, and excluded periodical interest accrued from these investments,” he said.
The company was in the process of making fresh investments and provide details of NSDL accounts to EoW for attachment. The effort seems to be towards maligning the reputation of 63 moons and weaken the legal defense of the company, which is our undisputable legal right, said Rajendran.
The EOW-Mumbai has already frozen ₹1,800 crore worth of bonds, despite there being no link to proceeds of crime. There are no hidden funds in the operating accounts and everything is transparent and above board, he added.
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