The decade old court case of Metropolitan Stock Exchange (MSEI) in the Supreme Court (SC) is reminiscent of Sunny Deol’s iconic dialogue ‘tareekh pe tareekh’ (day after day) in the Bollywood movie Damini that won the actor a national award.
Nearly 11 years ago, the Competition Commission of India (CCI) had ordered the National Stock Exchange (NSE) to pay ₹850 crore to MSEI as a penalty for monopolistic and predatory business practices. That order was also upheld by the CCI tribunal. NSE appealed against the CCI award to the Supreme Court and all that MSEI has got from the apex court so far is ‘tareekh pe tareekh’ .
The delay in justice is not helping the exchange’s cause. MSEI is on its deathbed since its net worth is fast depleting below the regulatory requirement of ₹100 crore. Market regulator SEBI has warned the exchange that it will not renew its license next year if the exchange cannot shore up its net worth. MSEI needs an urgent hearing at the Supreme Court. It has nearly 49,000 shareholders and hundreds of employees who will suffer if the exchange is shut.
The blame for the failure of the young exchange also lies with SEBI. Market development is SEBI’s key job and since it does micromanagement of exchanges by deciding appointments of top management personnel, it should also take the responsibility when the same management fails.
MSEI’s top management has not only failed in pursuing the Supreme Court case aggressively, but is also facing allegations of mismanagement and financial irregularities for which a forensic audit has been ordered. MSEI's misfortune and the vexatious situation will only further the cause of ‘monopolies’.