Investigative Agencies Go After The Defaulters In Nsel Case

Investigative Agencies have gone after the Defaulters in the National Spot Exchange Ltd (NSEL) case. The Economic Offences Wing (EOW) of the Mumbai Police has attached assets worth Rs. 5,000 crore of defaulters.  

“We have already secured recoveries worth Rs.1, 233.02 crores by way of decrees on admission against five defaulters and through injunctions from a total of 18 defaulters with outstanding of Rs.4, 515.93 crores. The EOW has attached assets worth around Rs.5,000 crore of defaulting trading members,” NSEL chief executive Prakash Chaturvedi said in a letter to shareholders. The NSEL case was unveiled when the exchange was unable to pay its traders in commodity pair’s contracts post-July 2013. 

In March, authorities issued public notices to sell properties of three defaulters —Swastik Overseas Corporation, Ferrochrome of Metkore Alloys & Industries, and Red Chilly & Black Pepper, part of Shree Radhey Trading. The Enforcement Directorate also attached assets worth around Rs.800 crore of defaulting traders, Chaturvedi added.Knight Frank has been assigned the responsibility of working as consultant by the Sessions court, to help bring prospective buyers for the sale of properties of Mohan India Group; one of the biggest defaulters. 

This is perfect for the approximately 11,000 NSEL traders who, according to the Sessions court, would get their dues paid once the liquidation of defaulters’ properties is expedited. Knight Frank’s global reach will allow individual and corporate clients to participate in high bids.  NSEL is being forced to merge with parent company 63 moons, of which Jignesh Shah is the promoter. However, it has claimed that two defaulters out of 24 have almost cleared their dues of Rs. 195.75 crore. It was also claimed that Rs. 542.99 crore has been disbursed, including a loan from FTIL. 

The Bombay High Court had set up a three-member committee to ensure smooth recovery and payback when NSEL was settling e-series contracts up to 98.48% by disbursing Rs. 298.52 crore to around 40000 E-series unit holders. NSEL has also revealed that it recovered Rs. 28.33 crore and just needs a nod from the high court committee to pay back to the legitimate trading clients.

Reference: http://www.nselrecoverygroup.com/defaulters/defaulters.html

For more information check 63 Moons.