rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » Ministry orders inspection of NSEL, Fin Tech books

Ministry orders inspection of NSEL, Fin Tech books

October 02, 2013 15:08 IST

MCXAmid the Rs 5,600-crore (Rs 56-billion) payment crisis at the National Spot Exchange, the Ministry of Corporate Affairs has ordered the inspection of account books of the bourse and its promoter Financial Technologies India.

In the wake of the crisis, which also raised concerns about the violation of various regulations, the National Spot Exchange Ltd has come under the scanner of multiple authorities and investigating agencies, including the Central Bureau of Investigation.

The Ministry of Corporate Affairs ordered the inspection of the books of accounts of NSEL and Financial Technologies India Ltd to ascertain if any rules under the Companies Act were violated, a senior official said.

The Companies Act empowers the ministry to inspect the books of accounts of firms.

The ministry has already asked the Registrar of Companies to provide details about NSEL, its promoter group and related entities.

The report is expected to be submitted to the ministry in a few weeks.

NSEL, a commodity exchange promoted by Jignesh Shah-led FTIL, is grappling with settling dues of about Rs 5,600 crore after it suspended trading on July 31 following a government directive.

On Tuesday, the economic offences wing of the Mumbai police froze the exchange's bank accounts.

The NSEL defaulted on its committed weekly payout for the seventh consecutive time on Wednesday after the accounts were frozen.

According to its settlement plan, NSEL would pay Rs 3,494.4 crore (Rs 34.94 billion) of dues to investors this year in instalments of Rs 174.72 crore (Rs 1.74 billion) every Tuesday.

The Central Bureau of Investigation has started an enquiry into alleged irregularities at NSEL.

Last week, Finance Minister P Chidambaram had said the NSEL had violated rules from day one and the matter was being looked into by the ministry, the CBI and the Forward Markets Commission, the commodity markets regulator, among others.

© Copyright 2014 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.