NSEL scam: Don’t intend to take coercive action against ex-FMC chairman, police tell HC

The Mumbai police's Economic Offences Wing has said it will not take any action against former Forward Markets Commission chairman Ramesh Abhishek as part of its investigation into the NSEL scam. The police's announcement came after Abhishek's legal team said they feared he would come under scrutiny following a special court's direction that he be investigated. Abhishek challenged this order in the Bombay high court. The National Spot Exchange Limited, which was accused of cheating investors of INR5,547 crore ($740m) between 2008 and 2013, claimed Abhishek was involved in decisions relating to its business.

In a reprieve to former Forward Markets Commission (FMC) chairman Ramesh Abhishek, the Economic Offences Wing (EOW) of the Mumbai police recently told the Bombay high court that they did not wish to take any coercive action against the retired IAS officer as part of its probe into the NSEL (National Spot Exchange Limited) scam.

The Secretary, DIPP, Shri Ramesh Abhishek addressing at the release of the ranking of States/UTs under the Business Reform Action Plan, in New Delhi on July 10, 2018.

The police’s response came after Abhishek’s counsel expressed apprehension that EOW might go tough on him following directions by a special MPID (Maharashtra Protection of Interests of Depositors (in Financial Institutions) Act) court that he be specifically probed.

Abhishek, who was a secretary in the department for promotion of industry and internal trade, approached the HC on June 2 challenging the special court’s order.

Apart from questioning NSEL’s locus standi (legal right) to file a plea, Abhishek’s lawyer pointed out that the investigating officer in the case had concluded that the then FMC chairman had had no role in the scam and since there was no evidence against him, a chargesheet was not filed.

During a hearing on NSEL’s petition on May 12, the special MPID court ordered the EOW to investigate the purported role played by Abhishek and submit a report.

EOW, however, objected to the plea saying NSEL was the prime accused in the case and therefore, did not have the locus standi to file the application. The agency also claimed that everything had been done by NSEL and others could not be held responsible for the act of applicant.

On June 20, a division bench of justice Revati Mohite Dere and justice Gauri Godse allowed EOW to go ahead with its probe against Abhishek but restrained the agency from filing any report before the special MPID court. The HC also recorded the statement of special public prosecutor Avinash Avhad that EOW does not intend to take any coercive steps against the retired bureaucrat.

According to EOW, between 2008 and 2013, NSEL had appointed 25 members as sellers and allowed them to trade on their exchange. The sellers, in collusion with the NSEL management, had cheated about 13,000 investors of ₹5,547 crore, it said.

FMC is a regulator for commodity and future markets in India.