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HindustanTimes Wed,20 Aug 2014

FMC will audit NSEL’s e-series contracts: HC told

Bhavya Dore, Hindustan Times   Mumbai, October 28, 2013
First Published: 23:48 IST(28/10/2013) | Last Updated: 00:00 IST(29/10/2013)

The forward markets commission (FMC) will conduct a forensic audit on e-series contracts of the crisis-hit National Spot Exchange Limited (NSEL), additional solicitor general K Setalwad told the Bombay high court on Monday.

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Setalwad said the FMC would issue orders to the NSEL not to permit any re-materialisation requests or physical delivery until the audit had been completed and its report received.

The division bench of judges SJ Vazifdar and KR Shriram ordered that re-materialisation requests not be “processed or honoured for a period of four weeks” from the time when a copy of the audit report is furnished to the petitioners.

The court was hearing a bunch of petitions filed against the FMC and other commissions, including a petition which sought to stay the settlement of e-series contracts of NSEL. E-series trading was suspended in August, after which the FMC started receiving requests for re-materialisation.

In a previous order on October 7, the court had said that requests for financial settlement or physical delivery of e-series contracts be processed after October 25.

“I am happy that the high court has taken cognisance of the issue and asked for a forensic audit,” said Kirit Somaiya, BJP leader, who filed one of the PILs in the matter. “This is the beginning of a full-fledged investigation.”


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