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NSEL Crisis: Govt asks Sebi to Take Action Against Defaulting Brokers

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In a bid to speed up recovery of money in the Rs.5,574crore NSEL payment case, government has decided on immediate auction of non-encumbered properties while urging the markets regulator the Securities and Exchange Board of India (Sebi) to take action against defaulting brokers.

At a meeting chaired by Economic Affairs Secretary Shaktikanta Das, the Maharashtra government has been asked to take immediate action for auctioning the properties which do not have any encumbrance or have approval of the court.

The Maharashtra government has also been asked to actively pursue with the MPID court to obtain early orders for auctioning of the remaining attached properties and also appoint a senior advocate for the same.

The meeting reviewed the action taken and progress made on the recommendations made by the Special Team of Secretaries (STS) to ensure that there is no systemic impact of the NSEL crisis.

The Ministry of Corporate Affairs has been advised to decide on the draft order of the proposed merger of NSEL with its parent FTIL by February 15 -the time stipulated by court, the finance ministry said in a statement.

In October 2014, the ministry had ordered the merger but the same has been challenged in the courts.

FTIL owns little over 99% stake in NSEL.

“Besides, as directed by the Madras High Court, the Company Law Board (CLB) may be moved to decide the case relating to FTIL by March 11, 2016,“ the statement added.

“Ministry of Corporate Affairs has decided to file an SLP (Special Leave Petition) in the Supreme Court against the decision of Madras High Court. They were requested to expedite the same,“ it added.

The release said CBI is enquiring into the conduct of government officials, including that of two public sector undertakings, with a view to ascertain inter alia whether they were in any way involved in abetting the NSEL payment crisis.

Out of the outstanding amount, NSEL has so far distributed only Rs.304.50 crore up to September 10,2013. 

The Economic Times, New Delhi, 12 Feb 2016
 

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